Southwest Airlines has made it clear it’s not changing course on the quirks that have made it unique in the industry and have contributed to its strong passenger loyalty: no baggage charges, no change fees, no assigned seats.
CEO Gary Kelly told financial analysts Thursday that the airline has a “portfolio of new ideas” that will bring in more money, but changes in its core operating principles. “I don’t think we need to change the essence of what Southwest Airlines is to still find opportunities to drive revenues.”
And the revenues is a big topic; the airline has gone over 40 years without losing money and expects to continue to be profitable, despite rising fuel costs which have led airlines to post or predict fare hikes. Southwest claims a 4.4% drop in average fares over the past quarter, and expects tax cuts and other savings to offset the fuel cost.
Some of the ‘new ideas’ Kelly mentioned will not be seen in practice for at least a couple of years; for now, the airline’s expansion into Hawaii is the big news.
