SWA Early Out Program II
#1
SWA Early Out Program II
Southwest looks to cut costs with buyouts
By TREBOR BANSTETTER
[email protected]
Southwest Airlines is offering voluntary buyouts to 27 percent of its workforce in its latest effort to cut costs, a spokeswoman said Tuesday.
The Dallas-based carrier is offering the deal, which includes $25,000 in severance, some medical and dental benefits and some flight privileges, to about 9,000 employees. The buyouts are available only to workers above a certain pay grade, said spokeswoman Brandy King.
Southwest has been struggling with softer-than-expected revenues and higher costs this summer. Fuel prices, in particular, have had an impact, and the carrier has scaled back its growth plans. The airline is scheduled to report second-quarter earnings tomorrow.
“This is designed to address our cost challenges,” King said.
The airline has offered buyouts once before, in 2004, when most employees had the option of taking the deal. At that time, the airline was downsizing to match operational cuts it had made after Sept. 11, 2001.
The airline has never laid off employees.
King said airline officials worked with union leaders in crafting the buyout package. Employees have until Aug. 10 to decide whether to take the deal.
Shares of Southwest (ticker: LUV) were trading at $15.50, down 13 cents, at mid-morning Tuesday.
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I suppose this is a good thing. Interesting timing, though, with the quarterly earnings release scheduled for tomorrow.
By TREBOR BANSTETTER
[email protected]
Southwest Airlines is offering voluntary buyouts to 27 percent of its workforce in its latest effort to cut costs, a spokeswoman said Tuesday.
The Dallas-based carrier is offering the deal, which includes $25,000 in severance, some medical and dental benefits and some flight privileges, to about 9,000 employees. The buyouts are available only to workers above a certain pay grade, said spokeswoman Brandy King.
Southwest has been struggling with softer-than-expected revenues and higher costs this summer. Fuel prices, in particular, have had an impact, and the carrier has scaled back its growth plans. The airline is scheduled to report second-quarter earnings tomorrow.
“This is designed to address our cost challenges,” King said.
The airline has offered buyouts once before, in 2004, when most employees had the option of taking the deal. At that time, the airline was downsizing to match operational cuts it had made after Sept. 11, 2001.
The airline has never laid off employees.
King said airline officials worked with union leaders in crafting the buyout package. Employees have until Aug. 10 to decide whether to take the deal.
Shares of Southwest (ticker: LUV) were trading at $15.50, down 13 cents, at mid-morning Tuesday.
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I suppose this is a good thing. Interesting timing, though, with the quarterly earnings release scheduled for tomorrow.
#2
I personally applaud SW for their efforts to not force employees out of the company. But the question remains, Do any of you think SW would force employees out the door if they were facing financial trouble? Or do you think they would find other ways to cut costs and continue to offer an early out option?
#4
Southwest, unlike other airlines, is proactive when it comes to finding solutions to financial challenges. They always have been. They give their management, employees, and investors plenty of time to make decisions. I applaud them for noticing a shift in performance and immediately looking for ways to keep things on course and for offering choices to the people that are involved.
I liken their moves to a Captain who decides to go to his/her alternate prior to entering the storm, then deciding that he cannot make the airport, thus reducing his options considerably. Southwest tries to steer clear unlike some other airlines. UA, LLC, DAL, NWA, ATA . . .
I liken their moves to a Captain who decides to go to his/her alternate prior to entering the storm, then deciding that he cannot make the airport, thus reducing his options considerably. Southwest tries to steer clear unlike some other airlines. UA, LLC, DAL, NWA, ATA . . .
#6
Nope and the pilots that I talk to wont take concessions. After the contract is signed the doom and gloom will end. Typical section 6 tactics. The union and most pilots arent buying it though. The line will be held by this SWA pilot.
#7
S.B.
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