Friday, September 6, 2019

Southwest performance in Hawaii exceeding company expectations

Southwest Airlines flights to Hawaii continue to perform "tremendously successful right out of the gate," according to one executive.

The Dallas-based airline has been hyping service to Hawaii for years, but the level at which the market has responded to Hawaii flights has surprised even the company.

"We are performing, I would say, actually ahead of our expectations," Tammy Romo, chief financial officer of Southwest Airlines, told a crowd at the Cowen Global Transportation Conference on Wednesday.

Chief Executive Gary Kelly said in the company's most recent earnings call that load factors for Hawaii flights are exceeding network averages, and he pointed out Southwest is seeing historic load factors across the network.

Southwest's rollout of Hawaii flights was years in the making and delayed at the finish line because of a partial government shutdown. Then, once Southwest announced it was getting Hawaii flights finally up and running, the Boeing 737 Max crisis began.

Southwest is the largest operator of the Max with 34 in its fleet at the time of its March grounding, and it was scheduled to have 68 of the aircraft by year end, Romo said. The grounding means Southwest was dealing with a smaller fleet than anticipated.

The company announced in July it was done waiting for the Max to return to service and instead was axing service to some locations to make room for more Hawaii expansion. Notably, the airline announced it would stop flying to Newark Liberty International Airport, and locally suspended three routes out of Dallas Love Field.

Some in the industry area worried recent legislation which took some Airbnbs off the market on the island of Oahu, where Honolulu sits, would negatively impact demand for Hawaii travel.

"We haven’t seen really an impact," Romo said. "We’ll keep an eye on it."

(Evan Hoopfer - Dallas Business Journal)

1 comment:

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