February 21, 2024

Southwest Airlines CEO Bob Jordan: We expect strong full-year profit

Southwest Airlines The company is lowering its hiring target for this year amid delays to new planes Boeingthe airline’s chief executive Bob Jordan said on Thursday.

The Dallas-based airline expects to take delivery of 70 new 737 Max planes from Boeing Co this year, down from a previous forecast of 90, Southwest Airlines said in its quarterly report, which would cut its capacity growth plan by a percentage point. record.

Southwest Airlines, one of Boeing’s top customers, operates a fleet of 737s. By the end of the decade, the company had ordered 564 Boeing 737 Max planes, according to quarterly reports. The planes are more fuel-efficient and will replace older planes and help the company grow.

After the quarterly report, Jordan told CNBC’s “Squawk on the Street” that the company planned to add a net 7,000 employees this year, but must now “adjust” its goals.

The company did not respond to a request to detail how much the hiring program needs to be reduced.

Boeing employees sign a banner in front of the 737 MAX 8 produced for Southwest Airlines on March 13, 2018, as Boeing celebrates the roll-off of the 10,000th 737 from Renton, Washington, U.S.

REUTERS/Jason Redmond

Jordan said the company was trying to be “cautious” about its repeatedly delayed delivery expectations.

“You plan your schedule in advance, you set your capabilities, and you’re wrong. It’s really hard to change that approach,” Jordan told CNBC’s Phil LeBeau in an interview.

Chief Operating Officer Andrew Watterson said on Thursday’s quarterly conference call that the airline plans to reduce its flight schedule in the final months of the year because of the delays.

On Wednesday, Boeing Co said it planned to boost production of the 737 Max jet to 38 a month this year from about 31 currently, a long-planned increase delayed by supply chain issues and labor shortages.

American airlines CEO Robert Isom also complained about delivery delays when rival airlines reported quarterly results on Thursday.

“As far as the aircraft manufacturers, Boeing and Airbus, they have to do better,” Isom said in an interview on CNBC’s “Squawk Box” after the report was released. “When we didn’t receive the shipment on time, guess what? We had to cancel the flight. It affected thousands of customers.”

“We must hold them accountable,” Isom said.

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