Southwest Learns to Adapt to 737 Max ‘Crisis’
Skift Take
Southwest is concerned it is losing market share because of the Max grounding. That is likely true. But the Max is also forcing the airline to be more efficient about where it flies and when. That's probably helping boost unit revenue.
Southwest Airlines does not know when it will again fly what it once hailed as its newest and most efficient asset — the Boeing 737 Max jet. Executives on Thursday warned investors it is losing market share as it cuts longer routes to make better use of aircraft.
The airline reported fourth quarter net income of $514 million, down about 21 percent compared to the same period in 2018. For the full-year, net income was $2.3 billion, off about 6 percent, year-over-year.
That certainly could be viewed as an impressive performance for a carrier that by now should have at least 75 Max jets, which were to account for about 10 percent of its fleet. But it was a less lucrative year and quarter than it could have been, Southwest CEO Gary Kelly told analysts on the airline's fourth quarter earnings call on Thursday, when he referred to the Max situation as a "a crisis-like challenge."
Kelly told analysts the airline calculated it lost about $828 million last year in operating income be
