Talking to Southwest CEO Gary Kelly About New Airplanes, International Flying, More

Southwest CEO Gary Kelly was one of the featured speakers on the airline CEO panel at NBTA earlier this month. After his talk, he took a few minutes to sit down with me, Johnny Jet, and Dan Webb (from Things in the Sky) to answer any questions we might have. I’m not sure how, but this draft fell through the cracks and didn’t get published. I still think Southwest CEO Gary Kelly and His iPhone at NBTAit’s relevant and interesting, so, here are the highlights.

Johnny kicked off the questioning, and he asked about international plans.

Gary stated, “We definitely have plans to go international. Our first foray will be with our codeshare partners. I wouldn’t put any limits on our route system. All of those near international destinations [are possible].”

If you heard the recent news by ATW that Southwest said it would be going to long haul international, you can forget that for the foreseeable future. That was just not true.

Then Dan took a swing at some questions. He asked about Frontier’s Lynx operation. Since Southwest had first said it wasn’t interested in Lynx but then changed its mind, did that mean we might see Q400s in Southwest colors?

Gary brushed that off. “That was just live analysis that was taking place. . . . I told folks that we don’t have a vision for a regional jet operation. In the Frontier case, it’s there, so while it doesn’t fit with our vision, we’d have to deal with Lynx. It was very important in terms of the communities they serve.”

When Dan pressed him about the chance of the Q400 actually entering the fleet, Gary was firm. “It’s a pretty easy answer. Unless there’s some special set of circumstances, the answer is no.”

Bummer. Then the question was expanded to ask whether they would consider other aircraft manufacturers to supply their fleet.

Gary gave a somewhat cryptic response. “We’ll need to continue to keep our options open in the future in terms of fleet types. We’d love to keep flying Boeing exclusively, but that’s not a requirement.”

I took that to mean that they would like Boeing to think that they could go elsewhere but in reality, that won’t happen.

I chimed in and asked if they were thinking about other models of the 737, including the shorter 737-600 or (more likely) the longer 737-800 and 737-900.

Gary said no. “There’s no thought at this point . . . . We’re continue to evaluate whether a bigger airplane would serve us well but there’s not much effort underway. We’re hard-wired for 3 flight attendants – the fourth [as required for larger aircraft] becomes a technology issue and then why do you need it? . . . . I don’t think we’ve stretched the limits yet of the -700. We want to be very innovative. I think in the next year or two we may have a couple experiments along those lines.”

Interesting. I do wonder what it means to stretch the limits. Hawai’i? Caribbean? Unclear.

Gary confirmed that he didn’t see the airline’s seating policy or boarding process changing anytime soon, but there will be a Rapid Rewards relaunch as well as a next generation southwest.com coming next year.

I closed the time there with a question about Denver. It’s been unprofitable so far, so would they change any plans now that they lost the Frontier bid?

Gary got a little defensive here. “No. A lot of [those comments] were misguided. All new markets have a period of development. It has been the most successful city startup so far in the history of Southwest.”

By “successful,” I believe he’s referring to the fastest ramp-up. I’m pretty sure they aren’t measuring that based on profitability. But since then they’ve added more Denver service, so clearly the plan hasn’t changed.

17 Responses to Talking to Southwest CEO Gary Kelly About New Airplanes, International Flying, More

  1. A says:

    Sometimes I wish that Southwest had a CEO that was more like Michael O’Leary. At least it would make the interviews more exciting to read, and would probably include grand plans that would leave much fodder for discussion.

  2. David SFeastbay says:

    I still wonder why they serve a beverage and pretzels/cookies/crackers/or whatever they serve still. On one hour-ish flights between cities do people really need that. Would save money and that goes for all airlines. If people can sit at home and not eat or drink anything for an hour, they can do it on an airplane.

    Speaking of Michael O’Leary that -A- mentioned, none of you asked about stand up ‘seating’, pay toilets, or paying by the pound (of the traveler) fares?

  3. Oliver says:

    Haha, same cryptic respnses as usual until the SURPRISE! Announcements.

    What special set of circumstances would allow SWA to consider a second fleet type?

    Did Gary also mention details about the Rapid Rewards relaunch? Would they be big changes like JetBlue’s relaunch?

  4. I’m finding it sort of lame and interesting how hardwired all of SWA’s computer systems are.. They’re hardwired for three FAs? I guess they’re lucky the 737 never had a Flight engineer station, and their union never required them to have a flight engineer paid to watch.

    David SFeastbay wrote:

    I still wonder why they serve a beverage and pretzels/cookies/crackers/or whatever they serve still. On one hour-ish flights between cities do people really need that. Would save money and that goes for all airlines. If people can sit at home and not eat or drink anything for an hour, they can do it on an airplane.

    At this moment its probably more about image than anything else. Southwest wants the image that they give you a lot. As for serving drinks, people are more likely to want a drink on a plane due to the drier air.

  5. CF says:

    Oliver wrote:

    What special set of circumstances would allow SWA to consider a second fleet type?

    I think he was specifically referring to the Frontier acquisition effort which would have potentially introduced the Q400.

    Did Gary also mention details about the Rapid Rewards relaunch? Would they be big changes like JetBlue’s relaunch?

    Nope, no details.

    Nicholas Barnard wrote:

    I’m finding it sort of lame and interesting how hardwired all of SWA’s computer systems are.. They’re hardwired for three FAs?

    I don’t think he meant that in a computer system way but rather a process way. They have always had crew scheduling set up this way, so it would be a pretty big change to have to started building lines with different numbers of crew. Come to think of it, it may very well by a technology issue . . .

  6. MathFox says:

    When I am at home I drink 3 liter of tea a day, a little over one airline cup/hour. I admit that I won’t immediately die from dehydration when I drink less, but I certainly appreciate a quick drink during a short flight (instead of “due to the short duration of the flight there won’t be a drink service”.) Add boarding, deplaning, waiting for your luggage and a car ride to your destination to a “short” 45 minute flight and you’re without drinks for two hours easily.

    BTW, European airlines do serve a drink and a snack (sandwich) on short flights. Why do you have to buy your own food for a US coast-to-coast flight?

  7. Jay says:

    “If people can sit at home and not eat or drink anything for an hour, they can do it on an airplane.”

    People can also sit home and not eat or drink for five hours…..

    So, no drinks and snacks on Transcons either?

  8. I don’t like the Southwest boarding process but I admit they appear to have better legroom than American.

  9. frank says:

    @ MathFox:

    Food essentially disappeared after 9-11. Seriously, give it up. It was chicken or beef that was mass produced. Something had to give, apparently food and MY PENSION had to go so YOU can travel cheaply.

  10. SAN Greg says:

    Cranky – I know you tend to be fairly pro-SWA, so I read your article with a critical eye, and I have to admit you did a good job laying things out fair and unbiased. It was a good read. Nice write up.

  11. johnny0 says:

    If Southwest does start flying into Canada, I hope they consider flying from SFO to Victoria and Vancouver.

    United started direct flights to YYJ last year via United Express. While it is much better than the SEA or YVR bag drag, it has been ridiculously expensive from the start — it seems to always be around $500.

    United and Air Canada have a nice little lock on the flights to Vancouver since Alaska dropped that route last year, and prices have been constantly rising.

    Speaking of SWA code shares, I’m surprised that WestJet hasn’t taken up these routes.

  12. CDD says:

    I appreciate that you put the interviewee’s responses in context, and also, that you don’t drench their words in that high-fructose formality!

  13. Allen says:

    @ MathFox:

    Which “European Airlines” would those be? Lufthansa? FlyBe? British Airways? Tyrolean? Albanian Airlines? Aeroflot? Ryan? Swiss Airlines? Air Berlin? Sky Europe (hard to serve food when you’re not flying, eh?)? Air Moldova? Sibir Airlines? KLM? Bulgaria Air?

    I doubt that _all_ European airlines serve meals on _all_ flights. More so, even if they did their would still be the issue of price. It may seem like less service to not serve me more than an orange juice on on a flight from Denver to Minneapolis. But I’ll take having the option of spending an extra $5 or $20 on food and drink on the airplane + $300 round trip over $500+ round trip and cheap roast beef sandwich. Maybe this was a big deal years ago when food and drink choices were crappy. But these days we’ve got decent coffee and food widely available at most any major airport. Plus we can always just bring a bag of craisins or a cliff bar and a bottle of water on the airplane if we want.

    While the exact definition of service varies, I suspect for most fliers, even the once every other year types, have seen a change in what they expect for service, in what they value.

  14. David SFeastbay says:

    Cranky did he hint back in September about todays (Oct21) announcement about their new city will be Panama City, Florida and that the local land developer will make quarterly cash payments to them to help cover operations costs for the first 3yrs and share in the profits.

    Either WN needs the money or this is something that is done more then we hear about with carriers. Not counting EAS service with Uncle Sam.

  15. CF says:

    David SFeastbay wrote:

    Cranky did he hint back in September about todays (Oct21) announcement about their new city will be Panama City, Florida and that the local land developer will make quarterly cash payments to them to help cover operations costs for the first 3yrs and share in the profits.

    Uh, no. I’ll be writing about this sometime this week (if not tomorrow).

  16. Pingback: On Southwest and the 737-800 - Things in the Sky

  17. Pingback: Lil’ trip to San Diego/ NBTA | Johnny Jet

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