Southwest Airlines (Dallas)ย today announced it will share $355 million through its Profit Sharing Plan with its Employees for 2014โequaling approximately 9.6 percent of each eligible Employee’s eligible compensation, or the equivalent of five weeks’ pay. This $355 million contributionโnearly $1 million a dayโis the largest total dollar amount Southwest has ever allocated to Profit Sharing.
The airline continued:
“Not only is this amount $127 million more than the previous record, set with last year’s contribution of $228 million, but it’s also more than the last two years of ProfitSharing combinedโan increase of 56 percent compared with 2013. Since its inception, Southwest Airlines has shared more than $2.8 billion with its Employees through ProfitSharingโand almost $1 billion in the past six years alone.”
“Last year was chock-full of historic milestones and monumental accomplishments, and I’m immensely proud and grateful for our People who worked so hard to make it happen. It was truly a heroic effort,” said Gary Kelly, Chairman, President, and CEO of Southwest Airlines. “Our Employees take ownership in our success, and when the Company does well, our People do well. Because of them, we can realistically aspire to fulfill our Vision of becoming the World’s Most Loved, Most Flown, and Most Profitable Airline.”
When this Profit Sharing contribution is added to the Company’s $289 million in Company match and other amounts contributed to the Southwest and AirTran 401(k) retirement plans, Southwest will have rewarded Employees with a 2014 total retirement benefit of approximately $644 million. In addition to retirement contributions, Southwest Airlines also invested approximately $618 million in its Employees’ other benefits during 2014, including healthcare coverage, and other welfare and wellness programs. In total, that’s nearly $1.3 billion dedicated to the wealth and wellbeing of Southwest Employees in 2014 alone, on top of base salaries.
Southwest was the first in the industry to offer a Profit Sharing Plan. Through the Profit Sharing Plan, Southwest Employees currently own more than four percent of the Company’s outstanding shares.
Copyright Photo: Tony Storck/AirlinersGallery.com.ย Southwest Airlines Boeing 737-8H4 N8655D (msn 42529) with Aviation partners Boeing Split Scimitar Winglets approaches the runway at Baltimore/Washington.
Southwest Airlines aircraft slide (new livery only):
Southwest Airlines (Dallas)ย filed applications today (December 11) with the U.S. Department of Transportation (DOT) requesting approval to serve six destinations in Latin America with new, daily, nonstop service from William P. Hobby Airport in Houston. After receiving U.S. government approval of the new service, Southwest will begin selling these flights at Southwest.com, offering Customers nonstop options between Houston (Hobby) and four destinations in MexicoโCancun, Mexico City, Puerto Vallarta, and San Jose del Cabo/Los Cabosโas well as flights to San Jose, Costa Rica, and Belize City, Belize. Service to Philip S. W. Goldson International Airport in Belize City, Belize, adds a second destination in Central America, a seventh country, and the 96th city on the Southwest route map.
The new Houston flights will be made possible by the completion of an estimated $156 million five-gate international concourse now under construction at Hobby. The completed project will increase capacity for all airport functions and add a Federal Inspections Services (FIS) facility to streamline U.S. Customs and Border Protection screening and baggage processing for arriving international passengers.
Image: Houston Hobby Airport. A concept drawing of the new international concourse.
The Houston Hobby International Terminal Project will add five new gates, enabling scheduled international service from Hobby. Southwest is working in conjunction with the City of Houston, which is preparing for the new facility with surrounding infrastructure improvements including a new parking facility, central utility plant and roadway improvements throughout the Houston Hobby Airport district. A study conducted by Houston Airport System estimates the Houston Hobby International Terminal Project would add 10,000 jobs to the region and provide a $1.6 billion impact annually to the local economy. The study also expects the expanded facility to bring an additional 1.6 million air travelers each year.
Southwest is currently selling nonstop service on Saturdays between Houston (Hobby) and Queen Beatrix International Airport in Oranjestad, Aruba beginning on March 7, 2015. The Aruba flights are made possible by U.S. CBP Pre-clearance procedures, which provide U.S. border inspection in certain foreign countries including Aruba. This will allow Southwest Customers arriving at Hobby Airport from Aruba to deplane without further CBP inspections into the domestic terminal, quickly claim baggage and depart the airport, or make seamless connections to many of the more than 40 domestic destinations Southwest currently serves nonstop from Houston (Hobby).
One of Southwest Airlines’ original cities, Houston supports the fifth busiest operation in the carrier’s network of more than 90 airports across six countries, with approximately 150 departures a day from Houston (Hobby). More than 3,200 Southwest Employees are Houston-based and foster community and business partnerships across greater Houston that, in 2013 alone, bolstered nearly 170 nonprofit organizations with more than $900,000 in local charitable donations.
Top Copyright Photo: Brandon Farris/AirlinersGallery.com. Brand newย Boeing 737-8H4 WL N8654B (msn 37045) lands at Boeing Field in Seattle. Delivery is imminent.
Southwest Airlines (Dallas) has filed its application with the U.S. Department of Transportation (DOT) to provide daily, nonstop service between John Wayne Airport, Orange County (SNA) and Lic. Gustavo Diaz Ordaz International Airport (PVR) in Puerto Vallarta, Mexico, beginning June 7, 2015, subject to approvals from relevant governmental agencies.
In addition, Kelly announced the Company’s plans to add Saturday service between Baltimore/Washington International Airport and San Jose del Cabo/Los Cabos, Mexico, beginning on June 13, 2015, subject to approvals from relevant governmental agencies.
Additionally the airline will start daily Kansas City-New York (LaGuardia) flights on April 8, 2015.
Copyright Photo: Michael B. Ing/AirlinersGallery.com. Boeing 737-8H4 N8645A (msn 36907) with the Split Scimitar Winglets arrives in Los Angeles.
Southwest Airlines (Dallas) has signed an agreement with Red Rocks Biofuels LLC (RRB) to purchase low carbon renewable jet fuel, made using forest residues that will help reduce the risk of destructive wildfires in the Western United States. The airline’s agreement with RRB covers the purchase of approximately three million gallons per year. The blended product will be used at Southwest’s Bay Area operations with first delivery expected in 2016.
RRB’s first plant will convert approximately 140,000 dry tons of woody biomass feedstock into at least 12 million gallons per year of renewable jet, diesel, and naphtha fuels.
Southwest is a long-time member of Commercial Aviation Alternative Fuels Initiative (CAAFI) which is a government and industry coalition for the development and deployment of alternative jet fuel for commercial aviation. As a member of CAAFI, the airline has followed the progress of alternative fuel technologies. Red Rock Biofuels is the first viable opportunity the airline has found to meet its financial and sustainability objectives.
Copyright Photo: Ken Petersen/AirlinersGallery.com. A nice ramp portrait of Boeing 737-8H4 N8306H (msn 36983) with the Split Scimitar Winglets painted in the now old 2001 “Canyon Blue” livery.
Southwest Airlines (Dallas) will add seasonal and weekly (saturdays) service from Milwaukee to both Montego Bay, Jamaica and Punta Cana, Dominican Republic from January 24 through April 4, 2015 per Airline Route.
Meanwhile the company is trying to lower its rising costs with new efforts to remain competitive with its union contracts. Bloomberg Businessweek looks at this critical effort. Read the full article: CLICK HERE
Copyright Photo: Tony Storck/AirlinersGallery.com. “Heart Two” in the form of Boeing 737-8H4 N8645A (msn 36907) painted in the dazzling 2014 livery arrives at the Baltimore/Washington (BWI) hub.
Southwest Airlines (Dallas) today officially unveiled this new livery, theme and logo in a special ceremony this morning in Dallas despite some images being leaked, probably from where it was painted in Victorville, CA. The first aircraft to be repainted is the pictured Boeing 737-8H4 N8642E (msn 42525) (above) delivered new on August 6, 2014.
The company issued this statement this morning:
Southwest Airlines introduced a modern new look to its iconic brand today (September 8) at an event dedicated to its Employees. The airline proudly unveiled a new aircraft livery, named Heart One, airport experience, and logo. The new look puts the airlineโs Heart on display, showcasing the strength of the nearly 46,000 Employees Companywideโwhose dedication can be felt by every Customer each time Southwest Airlines connects them to whatโs important in their life.
โOur collective heartbeat is stronger and healthier than ever, and thatโs because of the warmth, the compassion, and the smiles of our People,โ said Gary Kelly, Southwest Airlines Chairman, President, and Chief Executive Officer. โThe Heart emblazoned on our aircraft, and within our new look, symbolizes our commitment that weโll remain true to our core values as we set our sights on the future.โ
Itโs a big year for Southwest, as the airline introduces its legendary brand to international destinations; the repeal of the Wright Amendment is within sight; and the integration of AirTran Airways operations is on track to be completed later this year. Southwest continues to evolve, serving more than 90 destinations, and expanding its footprint in big markets like New York City and Washington, D.C.
โWith all these exciting changes happening, we thought it was time for a new visual expression of our brandโone that marries our past to our present and sets the course for where weโre headed in the future,โ Kelly said.
NEW LOOK, SAME GREAT EXPERIENCE
The announcement of Southwest Airlinesโ modern new look introduces a striking new livery design, new iconic Southwest logo (above), newly designed inflight materials and magazine, an advertising campaign that celebrates the airlineโs unique personality, and a revamped experience both online and at its airport locations, all of which showcase the unique spirit and Heart of the brand, and communicate its focus on Customer care. In addition, the airline will introduce a refresh to its signature โDING!โ mnemonic.
To bring this all to life, Southwest collaborated with advertising and branding partners GSD&M, Lippincott, VML, Razorfish and Camelot Communicationsโeach an expert in their own field. The task was given to distill more than 40 years of rich history into one modern, impactful look, representing the exciting future of a one-of-a-kind airline.
โThe job wasnโt to change who we are,โ said Kevin Krone, Southwestโs Vice President and Chief Marketing Officer. โWe already know who we are. The job was to keep the elements of Southwest that our Employees and Customers love, and to make them a bold, modern expression of our future.โ
โWith so much of Southwestโs focus firmยฌly set on the future, it was a natural time to look at our visual identity,โ said Bob Jordan, Southwest Airlines Executive Vice President and Chief Commercial Officer.
โAs we developed the identity, it wasnโt just about the new livery or the logo, but about developing the total, integrated brand expression of Southwest,โ said Rodney Abbot, Senior Design Partner at Lippincott.
โThe Heart is our identity the same way the Heart of our Southwest Employees enhances the Customer experience, said Krone. โIt’s the finishing touch that makes the Southwest brand unique, demonstrating that Southwest cares about each and every Customer. Even on the belly of the plane, the Heart is a symbolic reminder that we put our Hearts into every flight.โ
โFor more than three decades, GSD&M has partnered with Southwest Airlines, so we certainly understand and believe in the power of Southwestโs Heart,โ said Marianne Malina, President of GSD&M. โWe were thrilled with the opportunity to partner with an extraordinary and talented team to bring Southwestโs love of People front and center. This work is a celebration of the great brand that Southwest has become and, most importantly, where itโs headed next.โ
Southwest Airlines and its partners did comprehensive research and held numerous focus groups with Employees and Customers to determine how best to create the new look. The airline heard that it was important to remain unique and to retain its personality; for these reasons, Southwest continues to use the vibrant color palate and striped tail that has long identified the carrier, while adding a modern touch, proudly displaying the Southwest name on the side of the fuselage and presenting the Heart on the aircraft belly. Southwest has had several different liveries and logos throughout its 43-year history; remaining current and relevant is critical to the sustainability and future growth of the brand.
As a legendary low-fare carrier, Southwest doesn’t make a change this bold without first assessing cost impact. The approach and focus with this launch has been with the intent to remain cost-neutral by using a phased rollout. Aircraft will receive the newly painted livery within the aircraftโs existing repainting schedule, with new aircraft delivered in the new Heart livery. In addition, many of the future airport conversions will be integrated into existing and upcoming airport improvement projects. Because Southwest is taking this cost-conscious approach to the conversion of planes and airports, it might be some time before Customers and Employees see the new design in person.
Copyright Photo: Southwest Airlines. The company again has bold new fuselage titles for good visibility.
Here is the message from Chairman, President and CEO Gary Kelly:
Forty-three years ago, Southwest launched a low-fare revolution that is still alive and well today. Ignited by a Maverick Spirit and a passion for serving others, we set out to do things differently than the other guys. Today, the world is a much different place than it was back in 1971. Our industry landscape is hardly recognizable, and our Customersโ travel habits have evolved. Southwest has evolved too โ but we have never stopped smiling.
Weโve been hard at work over the past decade transforming Southwest to be just as relevant and successful for the next four decades. We enhanced our cabin interiors, installing WiFi and offering free live TV onboard (thanks to DISHยฎ!). With the Boeing 737-800 series aircraft, weโre bringing on larger airplanes that are better suited for longer flights. We expanded in big markets like New York City and Washington, D.C. and revamped our Rapid Rewardsยฎ Frequent Flyer program. We acquired AirTran Airways, and weโre in the final stages of integrating our two airlines to become one by the end of this year. The AirTran integration set the stage for Southwest to launch international service for the first time in our history, which we did in July. And next month, a federal law (the Wright Amendment) restricting where we can fly domestically from our home airport of Dallas Love Field will be lifted โ giving us the freedom to serve more nonstop markets from our hometown.
With all these exciting changes happening, we thought it was time for a new visual expression of our brand โ one that marries our past to our present and sets the course for where weโre headed in the future. So this month, weโre introducing a modern, new look. Youโll see it throughout your experience with us. Our new logo showcases a Heart โ fitting for a Company whose very core has always been fueled by the heartbeat of its People. Our collective heartbeat is stronger and healthier than ever, and thatโs because of the warmth, the compassion, and the smiles of our People. This Heart symbolizes our commitment to you that weโll remain true to our core as we set our sights on the future.
What started as a revolution has undergone an evolution. But we havenโt changed what we stand for: low fares, a convenient flight schedule, and the friendliest Employees in the world. Our Purpose is to connect you, our valued Customer, to the moments that are most important in your life, through friendly, reliable, and low-cost air travel. That was true in 1971, and itโs just as true today. So, while our look may be new, our DNA is the same โ with the big Heart and big smile you have come to LUV. Thanks for coming along for the ride!
All images by Southwest Airlines.
Read the analysis by Bloomberg Businessweek: CLICK HERE
Southwest Airlines (Dallas) has announced two additional destinations from Dallas (Love Field). Flights between Dallas and both San Francisco International Airport and Oakland International Airport begin on January 6, 2015.
The carrier previously announced its post Wright Amendment offerings from Dallas (Love Field) which, along with the additions of Oakland and San Francisco, gives Dallas Customers access to a total of 33 destinations via nonstop service on Southwest Airlines by January 6, 2015.
Beginning October 13, 2014, Southwest will add nonstop service from Dallas (Love Field) to Baltimore/Washington, Chicago (Midway), Denver, Las Vegas, Los Angeles, Orlando, and Ronald Reagan Washington National.
On November 2, 2014, Southwest will add additional nonstop city offerings from Dallas (Love Field) to Atlanta, Ft. Lauderdale/Hollywood, Nashville, New York (LaGuardia), Phoenix, San Diego, Orange County/Santa Ana, and Tampa.
Copyright Photo: Ton Jochems/AirlinersGallery.com. Boeing 737-8H4 N8301J (msn 36980) “Warrior One” lands in Las Vegas.
Southwest Airlines (Dallas) today (July 1) launched an international service by inaugurating service to three Caribbean destinations from three of its US gateway cities. Southwest Airlines’ first international departure, flight WN 1804 from Baltimore/Washington to Oranjestad, Aruba, departed on time at 8:30 am EDT, closely followed by Southwest flight WN 906 to Montego Bay, Jamaica, where its first-ever scheduled international arrival was planned for just after 11 am EDT. A midday flight from Baltimore/Washington to Nassau/Paradise Island also brings Southwest Airlines to The Bahamas.
Customers on the carrier’s inaugural international flights from Baltimore/Washington joined those in two other gateway cities of Atlanta, and Orlando who celebrated alongside Employees with commemorative beach balls, snorkels and masks.
At the Company’s corporate headquarters in Dallas, Employees staffed a command center in the pre-dawn hours to monitor operational performance and new technology systems developed in partnership with Amadeus, a leading technology provider to the global travel industry. Its Altea suite of technology solutions is powering Southwest’s reservations, inventory, and departure control functions for international flying.
Read the analysis by Bloomberg Businessweek: CLICK HERE
Copyright Photo: Brian McDonough/AirlinersGallery.com. Boeing 737-8H4 N8633A (msn 36905) with the new Aviation Partners Boeing Split Scimitar Winglets arrives at Baltimore-Washington International Thurgood Marshall Airport (BWI).
Southwest Airlines (Dallas) today (May 28) announced mobile boarding passes are now available for Customers traveling throughout the United States. Today’s announcement marks the completion of the domestic rollout of the technology that will make getting through the airport quicker and greener. With the airline’s mobile boarding passes, Customers can use their smartphones or other electronic devices to get through security checkpoints and to board their aircraft.
Testing began in the fall of 2013 in Austin, followed by successful pilot programs in Houston and Dallas.
According to the airline, “This announcement comes on the heels of an update last week to their iOS and Android apps adding information about upcoming trips to the homepage. Customers can now quickly view the information that matters most while traveling, like flight status, boarding position, and gate information. Travel information will update in the app beginning 24 hours prior to a flight allowing Customers to check in and access their mobile boarding pass from the homepage”.
Copyright Photo: Tony Storck/AirlinersGallery.com. Boeing 737-8H4 N8306H (msn 36983) with the new Aviation Partners Boeing Split Scimitar Winglets approaches the runway at the Baltimore/Washington (BWI) hub.
Southwest Airlines (Dallas) announced its Board of Directors, at its meeting held today (May 14), increased the Company’s quarterly dividend by 50 percent and authorized a new $1 billion share repurchase program. Under the new $1 billion share repurchase authorization, an initial $200 million of Southwest common stock will be repurchased under an accelerated share repurchase program. The quarterly dividend will increase to $.06 per share from $.04 per share, beginning with the 151st consecutive quarterly dividend declared today to Shareholders of record at the close of business on June 4, 2014 on all shares then issued and outstanding. The dividend will be paid on June 25, 2014. Annualized, this increased dividend amounts to over $160 million based on approximately 692 million1 shares of common stock outstanding.
Gary C. Kelly, Chairman of the Board, President, and CEO, stated: “The actions taken today by our Board are in recognition of our strong financial position and performance, strong cash flow outlook, and dedication to returning value to our Shareholders. The Board authorized an increase in our quarterly dividend payment to $.06 per share from $.04 per share. Based on yesterday’s closing stock price of $24.98, this would provide an approximate one percent annual dividend yield to our Shareholders. The Board also authorized a new $1 billion share repurchase program. Last week, we completed our previous total $1.5 billion share repurchase authorization, bringing the cumulative return to Shareholders through share repurchases and dividends, since August 2011, to approximately $1.7 billion.
“Today’s announcement enables us to further Southwest’s long-standing commitment to deploy capital back to our Shareholders, while preserving our financial strength. We have maintained an investment-grade credit rating for over 30 years, the only U.S. airline with such a distinction. Our balance sheet and liquidity remain strong with cash and short-term investments of approximately $3.7 billion1, and a fully available unsecured revolving credit line of $1 billion. As of April 30, 2014, we have reduced our debt and capital lease obligations, net, by approximately $1.5 billion since the acquisition of AirTran, and intend to repay an additional $470 million in debt and capital lease obligations for the remainder of this year.
“With the upcoming repeal of the Wright Amendment, launch of international service, launch of service from the additional slots acquired at New York’s LaGuardia Airport and Reagan Washington National Airport, and the planned completion of the AirTran integration, 2014 is a monumental year for Southwest and our Shareholders. We are very pleased with the successful execution of our major strategic initiatives thus far, which have contributed significantly to our profits. The momentum from our record first quarter 2014 results continued into April, with strong traffic and revenue trends. Based on these trends and our current outlook, we are on track with our plan to achieve a 15 percent pre-tax return on invested capital, excluding special items, this year.”
As of May 9, 2014, the Company completed its previous total $1.5 billion share repurchase authorization, including $200 million, or approximately 8.6 million shares, under an accelerated share repurchase program launched in February 2014. Under the total $1.5 billion share repurchase authorization, the Company repurchased approximately 126 million shares, which has reduced its shares outstanding by over 15 percent since August 2011. The Company intends to execute an agreement today to implement a new $200 million accelerated share repurchase program. The remaining $800 million of authorized share repurchases under the new program will be made in accordance with applicable securities laws in open market, private, or accelerated repurchase transactions from time to time, depending on market conditions, but may be discontinued at any time.
Copyright Photo: Bruce Drum/AirlinersGallery.com. Boeing 737-8H4 N8305E (msn 36683) taxies to the runway at Seattle-Tacoma International Airport. On April 9, 2014ย operated its first revenue flight utilizing a Boeing 737-800 equipped with Aviation Partner’s Boeing Split Scimitar Winglets. The newly designed winglet differs than those currently installed on the carrier’s fleet of Boeing 737s, with aerodynamic scimitar tips and a large ventral strake on the bottom of the blended winglet structure. By upgrading the 737-800s with Split Scimitar Winglets, annual fuel savings are estimated to increase from approximately 3.5 percent per aircraft from Blended Winglets to approximately 5 to 5.5 percent per aircraft annually. In addition, the new winglet will reduce emissions, supporting Southwest’s commitment to the environment.ย The Split Scimitar Winglets will be installed on 33 new 737-800s once they are delivered to the airline this year. The airline also plans to retrofit 52 additional 737-800s currently in the fleet. The retrofits are expected to be completed by early 2015. All of the carrier’s Boeing 737-700s and 737-800s, as well as a majority of its 737-300s, are equipped with Blended Winglets saving the company roughly 55 million gallons of fuel annually. Blended Winglets were first installed on Southwest Airlines Boeing 737s in 2007.
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