Baltimore Sun: Southwest CEO discusses furloughs, braces for dismal winter

By Hallie Miller
November 20, 2020

With the coronavirus pandemic continuing to rage across the country, more than 100 Southwest Airlines employees in Maryland could be placed on temporary furloughs starting this January as the company braces for the impact of a dismal winter.

The layoffs could take effect Jan. 25 if the virus maintains its current course, Southwest CEO Gary C. Kelly said during a virtual symposium Nov. 20 with the Greater Baltimore Committee. He said the company will benefit from some holiday travel over the next few weeks, but expects air travel to slow dramatically in the first half of 2021.

“It’s temporary, and hopefully we’re in a position where we’re breaking even again next year,” Kelly said.

Kelly, who is currently not collecting a salary, said the company remains 20% overstaffed even after offering voluntary separation packages and extended leave programs to about 16,000 workers. Southwest also has instituted pay cuts for some non-union employees.

Southwest rebounded slightly in May and June after some governors lifted COVID-19 restrictions around the country following several weeks of widespread stay-at-home orders and travel advisories, Kelly said. But the progress ground to a halt in July and September as cases picked back up again in certain parts of the country.

If another stimulus package made its way out of Washington, Southwest might be able to avoid the furloughs, he added.

The airline, BWI Airport’s largest carrier, had initially predicted 2020 would be its best year on record. The collapse of tourism, hospitality and routine travel stunned Kelly and other executives as they went from comfortable levels of profitability to penny pinching in less than a year’s time.

Southwest, like other airlines, has been dogged by public health pleas for social distancing, which makes air travel less feasible. The company has responded by leaving every middle seat empty for several months, a policy it will reverse next month.

Kelly said that decision stemmed from internal studies that point to empty seats as an unnecessary step given other protocols meant to stave off transmission. Southwest airliners already have high-efficiency filtration in place designed specifically to prevent the spread of diseases and the airline limits the number of people who can board and disembark at a time. Now, everyone on board must wear a mask.

To read the complete story, visit the Baltimore Sun website.

Source: Baltimore Sun

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