REF 5

Now that they have reported their numbers, here are some comps. Lots of news about assign seating/premuim/red eyes but at the end of the day these iniatives are needed.

Operating Margins

DAL-13.6%
UAL-12.8%
AAL-9.7%
SWA-5.7%
ALK-11.1%

Domestic Capacity

DAL-up 8%
AAL- up 8.6%
UAL-up 5.3%
SWA-up 8.6%
ALK-up 6%

Domestic Yields

DAL-down 2%
AAL-down 6.5%
UAL-down 1.2%
SWA-down 2.7%
ALK-flat

Net cash was still positive at about 2.0 Billion. SWA will seek compensation from Boeing due to aircraft delivery delays. That will probably help pay for the cabin refresh due to lower costs to acquire aircraft from Boeing. Mx was up 29%. Thats horrible. It's definitely hurting the bottom line. Interest income was 130 miilion for the quarter. All that cash sitting making interest. They also paid some PPP warrants in the quarter. I think JBLU and Spirit report next week. Capacity has killed yields. All have indicated the third and forth quarter, capacity will come down and hopefully yields will stabilize. SWA still has a cost problem that will not go away until they get new aircraft. It's as simple as that. They have to make due of what they have.

flensr

SWA admitted that they grossly undercharged for tickets. Year over year ticket prices DROPPED 0.3% while expenses climbed 11% across the board. Oops.

They blamed it on new software. Nobody's gonna get fired, SAIEW

REF 5

You are absolutely right but even if the new rev management was firing on all cylinders, it wouldn’t have been able to counter all the capacity increases. Bottom line, their was way more capacity than demand in the quarter. Plus the fact that SWA doesn’t have much of any product to up charge. Every other airline saw a drop in yields and they have more capability to upcharge their product.

e6bpilot

Yep. Something that every airline has reported so far this quarter is that those pesky other airlines are flooding the market with capacity. Maybe because that's what the demand signal has been for the last three years.

This too shall pass. SWA has a built in capacity reduction program known as Boeing Inc. Hiring has stopped. They have an activist investor knocking on their door. If any airline is due for a turnaround, it's SWA. They still have an extremely healthy balance sheet and a lot of levers they can pull for revenue. They just currently lack the leadership to get the job done. Give it time.

Request20Right

https://www.youtube.com/watch?v=rslc...Y29ub21pY3M%3D

Interesting video and very well done. Shows the urgent need for US to increase revenue streams. Legacy carriers are capitalizing on the post-covid boom to make high revenue on premium cabins, and we don't have that lever to pull in the same way... until now. We shall see what their plan for premium seating is. I have a feeing it'll just be a little more leg room, rather than a 2X2 seat configuration up front.

Proximity

It will be more legroom. The company has made that clear in many different channels.

Cachaco

I find SW is consistently one of the most expensive, if not the most when pricing trips. And they say they are grossly undercharging?

Mozam

They like to say a lot of off-the-cuff comments. One of the meltdowns they blamed it on the odd shape of Florida ( no other airline was having issues ) . Actually that COO had many crazy one liners. Good new is that he is still on the payroll as an advisor

e6bpilot

You have to look at the average price across the board. Yeah, on a lot of one off point to point routes that SWA has the lock on, it is the most expensive. There are still a lot of cheap tickets out there, though, and especially post Christmas meltdown. They flooded a lot of markets, especially newer ones, with cheap tickets.
There is no way the current structure of ticket pricing survives the next two years. They will have to get out of the "all in" model and start unbundling so that they can match prices on aggregators and try to keep some sort of competitive advantage like maybe one checked bag for free. Seat selection is clearly coming, but that is only the first step. They aren't going to be able to make a dent in the costs, so revenue has to increase. It is what it is. It's past time to move into the previous decade. What they are doing now clearly isn't working.

RckyMtHigh

As a family of four checking 6-8 bags for a weeklong ski vacation, those no baggage fees go a long way toward making up any delta.

As a swa employee do I think we should be charging? I'm not sure, but as a customer I sure do love all the no fee stuff