Southwest Airlines Leaders Discuss Plans
DALLAS (AP) - Southwest Airlines Co. is poised to make its biggest acquisition ever, plans to add new types of planes to its famously streamlined fleet and soon may fly outside the United States.
CEO Gary Kelly and other top Southwest officials are expected to discuss those topics and more when they meet with reporters Thursday during the company's annual media day.
Last week, the company announced it earned $205 million in the third quarter thanks to more traffic and higher fares. Kelly said bookings for the rest of the year look good, a trend he thinks will carry over into 2011.
This week, Southwest rolled out a sale that included some one-way tickets in early December and January as cheap as $30. Tom Parsons, CEO of discount travel website Bestfares.com, said the sale shows that Southwest is struggling to fill its planes during the typically slow winter months.
JPMorgan analyst Jamie Baker downgraded Southwest stock this week to "neutral" from "overweight." Partly because, Baker said, the shares are no longer a bargain because they've rallied nearly 20 percent since late August. He also cited the risks in Southwest buying AirTran for $1.4 billion. Airline mergers are notoriously difficult because of problems combining work forces and different fleets.
Buying AirTran would put Southwest in Atlanta and a few markets in Mexico and the Caribbean. Southwest is also overhauling its loyalty program, although officials have said very little about the coming changes.
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