Southwest Airlines warns staff of ‘tough decisions’ ahead, Bloomberg reports

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Southwest Airlines warns staff of ‘tough decisions’ ahead, Bloomberg reports

(Reuters) – Southwest Airlines has warned employees that it will soon make tough decisions as part of a strategy to restore profits and counter demands from activist investor Elliott Investment Management, Bloomberg News reported on Saturday.

The airline is considering making changes to its flight routes and schedules to increase revenue, the report added, citing the transcript of a video message to employees by Chief Operating Officer Andrew Watterson.

“I apologize in advance if you as an individual are affected by it,” Watterson said, according to the report, adding that he didn’t offer any details on the pending moves.

Southwest did not immediately respond to a Reuters request for comment.

The airline has been struggling to find its footing after the COVID-19 pandemic, in part due to Boeing’s aircraft delivery delays and industry-wide overcapacity in the domestic market.

It plans to offer assigned and extra-legroom seats to attract premium travelers and start overnight flights. It will present the details to investors on Sept. 26.

Earlier this week, Reuters reported that Elliott, which owns 10% of Southwest’s common shares, told one of the company’s top unions it still wants to replace CEO Robert Jordan, even after the carrier pledged to shake up its board.

(Reporting by Surbhi Misra in Bengaluru; Editing by Paul Simao)

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