Southwest CEO Says Airline Industry Facing Possible Radical Restructure

Southwest CEO Says Airline Industry Facing Possible Radical Restructure

By Donald Wood, TravelPulse

The chief executive officer of Southwest Airlines spoke extensively about possible changes coming to the aviation industry in the coming months and years as a result of the ongoing coronavirus outbreak.

Southwest CEO Says Airline Industry Facing Possible Radical Restructure
© SkyCaptain86/iStock Editorial/Getty Images Plus A Southwest Airlines Boeing 737 on the tarmac in Puerto Vallarta, Mexico

According to Fox Business, Southwest CEO Gary Kelly spoke Thursday about the possibilities of a need to “radically restructure” Southwest and the airline industry as a whole after the government required carriers not to lay off employees until September 30.

The requisite was added to the $3.29 billion payroll loan deal Southwest reached with the U.S. government. Kelly believes that if air traffic doesn’t increase soon, airlines will begin to run out of money.

The CEO did have a more positive spin on the future. While Kelly did admit business travel could be “very weak” for a longer time, Southwest and other carriers are scheduled to start offering international service again in June as restrictions are lifted.

Southwest is targeting Mexico and the Caribbean as critical markets in June, with Kelly believing American travelers “want to travel to these resort-type destinations.”

Airlines for America officials told Reuters that carries in the U.S. are still spending more than $10 billion per month during the viral pandemic, but the demand for air travel is down around 90 percent.

Earlier this week, the U.S. Department of Transportation (DOT) announced it would permit airlines to cease flying to as much as five percent of the destinations that they had previously served.

The decision was intended to help provide some relief for carriers hemorrhaging money during the ongoing crisis.

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