Southwest Airlines is resuming its rapid rise. Airplanes are holding it back.
Newly appointed airline CEO Gary Kelly shared this information with CNBC’s “Squawk on the Street” on Thursday.
We don’t think we have enough planes for 2022 and 2023, and that’s who we are, he said to Jim Kramer, speaking of the airline’s low-cost domestic flying.
Southwest is one of the four largest US airlines by fleet size, according to Cirium data, and has approximately 80 more aircraft parked or stored. The world’s largest low-cost carrier is planning a fleet based on the Boeing 737 Max.Southwest has increased its order book for the embattled jet, and they could get great deals from Boeing as a result.
The Wall Street Journal reported that Boeing has been dropping prices as a result of the 737 Max grounding in the US.
Southwest Airlines also hinted at a potential expansion of the route network using their current fleet. The 737 can help expand both North and South America, according to Kelly. While Southwest has yet to serve Canada, all South American countries are reachable with the 737 Max 7 and its 3,850-mile range.
Southwest 737s are able to fly from Florida to destinations as far south as Ecuador, Brazil, and Bolivia.
This shows how quickly the domestic travel landscape has changed after the vaccines were given out. A year ago, the airline sold three Boeing 737-700 planes to a new startup, Avelo Airlines, which will open a base in New Haven, Connecticut, in the near future.
Southwest, knowing everything they know now, would have kept the 737-700 fleet, or as many 737-700s as they did. According to Atmosphere Research Group cofounder Henry Harteveldt, “
New Boeing 737s are plentiful, but Southwest can not simply purchase new planes. This multi-million-dollar investment will contradict Southwest’s future fleet plans.
Harteveldt added that acquiring an aeroplane is more complex than deciding whether to buy or lease a used car.
Author: THOMAS PALLINI