Southwest’s cost cutting expands into its first mass layoff
Southwest Airlines on Monday said it will cut roughly 15% of its corporate workforce, the first mass layoff in its 53-year history.
The nearly 1,800 job cuts add to an already substantial list of cost-cutting measures undertaken by Southwest recently. The airline ceded five board seats to activist investor Elliott Management in October and laid out a three-year savings plan. It’s ditched its open-seating policy, cut more than 300 pilot and flight attendant positions, stopped service to certain airports, and last month froze hiring and promotions.
When it reported earnings last month, Southwest said its nonfuel costs could spike as much as 9% in Q1, following an 11% jump late last year.
Southwest said it will see savings of more than $500 million over the next two years due to the cuts.
Investors were nonplussed: the stock, which is down 11% already this year, fell 1% in early trading.
When it reported earnings last month, Southwest said its nonfuel costs could spike as much as 9% in Q1, following an 11% jump late last year.
Southwest said it will see savings of more than $500 million over the next two years due to the cuts.
Investors were nonplussed: the stock, which is down 11% already this year, fell 1% in early trading.
