SOUTHWEST Airlines ! WN ! SWA !

Boeing seeks Southwest’s input on narrowbody plans
[Vous devez être inscrit et connecté pour voir ce lien] Commercial Airplanes chief Jim Albaugh is stressing that whatever direction the airframer takes in future narrowbody developments, its key customer Southwest Airlines will be "very involved" in the process.
Responding to a query that Southwest is pushing for the development of a clean-sheet narrowbody, Albaugh says he spoke to Kelly last week, and those discussions focused on both a re-engined option and a brand new design.
Albaugh says that whatever Boeing ultimately decides to do, it will be "something Gary Kelly likes". Southwest is one of Boeing's largest 737 customers, operating 543 of the type

Southwest: Breakdown is now an act of God

If there's a God who controls floods and earthquakes, does the deity also have a hand in an airline's mechanical problems?
Apparently so, according to Tucson's most popular airline, which recently added "mechanical difficulties" to the list of acts of God and other events for which the carrier will not be liable if travel is delayed.
Southwest Airlines quietly made the change a few weeks ago, to the puzzlement of some industry analysts.
It appears on page 11 of 32 pages of fine print called a "contract of carriage," which many passengers don't read, but which spells out their recourse in mishaps such as flight interruptions or baggage loss.
Mechanical difficulties - what type is not defined - now appears on a list of events such as wars, riots, storms, earthquakes and other acts of God that are "outside of (Southwest's) control."
In such cases, the contract says, passengers are entitled to refunds only on the used portion of their tickets. Southwest has no obligation to provide compensation for "any type of special, incidential or consequential damages."
Southwest spokesman Chris Mainz downplayed the significance of the change.
Mainz said Southwest would continue to assist passengers just as in the past, for example by putting them up in hotels if they are stranded during travel.
Asked why Southwest would change its contract if it doesn't intend to change its practices, Mainz said in an e-mail that the modification was made to "limit our exposure to liability."
Mainz also said the change would make Southwest "more consistent with the industry standard." However, when the Arizona Daily Star reviewed passenger contracts for four other major airlines - Delta, American, Continental and United - none included "mechanical difficulties" as an event outside the carrier's control.
Robert Mann, an airline industry analyst based in Port Washington, N.Y., called it "surprising" that Southwest, which has a reputation for stellar customer service, would make a change that puts passengers at a legal disadvantage if an aircraft breakdown delays their travel.
Keeping a fleet mechanically sound "is certainly within the control of any airline," Mann said. "Putting mechanical issues in the same category as an act of God - I don't think that's what God intended."
Even if Southwest sticks to its current level of customer aid, Mann said, the new contract wording sets a bad industry precedent.
"While I take Southwest at their word to do the right thing for customers, there are others in the industry who will adopt this on a 'me, too' basis and hold to the letter of that language, really disadvantaging customers on an issue that is absolutely within a carrier's responsibility and control."
Industry analyst Michael Boyd of Evergreen, Colo., agreed other airlines are likely to follow suit.
"The way the industry is today, airlines are sitting around watching each other," he said. "If the other guy does something that makes money and the consumer doesn't revolt, they're going to do it, too."
"I can see (carriers) saying, 'It wasn't our fault the airplane broke down,' and I also can see customers saying, 'I bought a ticket from you and I have reasonable expectation that the airplane is going to work,' " Mann said.
Southwest is the top choice of passengers at Tucson International Airport, used by nearly a third of the 3.6 million travelers who flew into or out of TIA last year.

Southwest Airlines today reported second quarter 2010 net income of $112 million, or $.15 per diluted share, compared to net income of $91 million, or $.12 per diluted share, for second quarter 2009.

Both years' results included special items related to non-cash, mark-to-market, and other items associated with a portion of the Company's fuel hedge portfolio.

Excluding special items for both periods, second quarter 2010 net income was $216 million, or $.29 per diluted share, compared to $59 million, or $.08 per diluted share, for second quarter 2009.

The second quarter 2010 net income, excluding special items, of $.29 per diluted share exceeded Thomson's First Call
mean estimate of $.27 per diluted share.

Additional information regarding special items is included in this release and in the accompanying reconciliation tables.

Gary C. Kelly, Chairman of the Board, President, and Chief Executive Officer, stated: "We are extremely pleased with our second quarter results. Second quarter net income (excluding special items) dramatically improved over second quarter last year, largely due to another record revenue performance.

Total operating revenues reached an all-time quarterly record of $3.2 billion, a year-over-year increase of 21 percent.

On a unit basis, our revenues increased approximately 22 percent, compared to second quarter last year, also an all-time quarterly record. Second quarter pretax margin (excluding special items) was 11 percent.

Our second quarter 2010 earnings performance (excluding special items) was second-best in our history, behind second quarter 2006.

This was, indeed, a strong performance, despite significantly higher fuel prices and other cost pressures.

"We have made excellent progress toward generating revenue levels sufficient to reach our 15 percent pretax return on invested capital target. Although business demand has not fully recovered, it has strengthened, and consumer travel demand is robust. We experienced record traffic levels during the quarter, despite flat year-over-year capacity, demonstrating a continuing and significant market share shift to Southwest, in part due to our unique and successful 'Bags Fly Free' policy.

Further, we led the industry with our year-over-year domestic passenger revenue and corresponding unit revenue performance.
It is, without question, our Employees who make it possible for Southwest to remain such a great Company, and I am very grateful for their hard work and steadfast delivery of outstanding Service to our Customers.

"After an array of revenue records set over the past three quarters, and based on current traffic and booking trends, an all-time record load factor is possible for July. We have built considerable, industry-leading revenue momentum that began in second half 2009. We see no signs that the momentum will stall in second half 2010.

Based on traffic and revenue trends to date, we expect strong year-over-year unit revenue growth in third quarter 2010. Our year-over-year growth rates will face more and more difficult comparisons, of course, due to the rapid revenue recovery that began at Southwest a year ago.

Each of the three years preceding 2009 experienced more normal seasonal trends and provide a better gauge of second half 2010 potential revenue health."

Second quarter 2010 unit costs, excluding special items, increased 13.6 percent from second quarter 2009, largely due to a 32.4 percent increase in economic fuel costs to $2.37 per gallon.

Second quarter 2010 economic fuel costs included $39 million in unfavorable cash settlements for fuel derivative contracts.

As of July 26th, the Company had derivative contracts in place for approximately 55 percent of its estimated third quarter 2010 fuel consumption at varying crude-equivalent prices up to approximately $100 per barrel;
approximately 30 percent if market prices settle in the $100 to $120 per barrel range; and approximately 45 percent if market prices exceed $120 per barrel.

Based on this fuel hedge position and market prices (as of July 26th), the Company estimates economic fuel costs, including fuel taxes, for third quarter 2010 will be in the $2.40 per gallon range.

For fourth quarter 2010, the Company has derivative contracts in place for approximately 40 percent of its estimated fuel consumption at varying crude-equivalent prices up to approximately $95 per barrel; approximately 10 percent if market prices settle in the $95 to $120 per barrel range; and approximately 30 percent if market prices exceed $120
per barrel.

The Company has derivative contracts in place for approximately 70 percent of its 2011 consumption at varying crude-equivalent prices up to approximately $95 per barrel; approximately 50 percent if market prices settle between $95 and $105 per barrel; and approximately 70 percent if market prices exceed $105 per barrel.

Beyond 2011, the Company has coverage of approximately 60 percent of its estimated fuel consumption in 2012; approximately 50 percent in 2013; and approximately 45 percent in 2014 at varying price levels.

The total market value (as of July 26th) of the Company's net fuel derivative contracts for the remainder of 2010 through 2014 reflects a net liability of approximately $227 million.

Excluding fuel, second quarter 2010 unit costs increased 6.4 percent from a year ago, which was a smaller increase than anticipated primarily due to lower advertising and an $18 million refund of excess security fees charged by the Transportation Security Administration since 2005.

Based on current cost trends, the Company expects a similar year-over-year increase in its third quarter 2010 nonfuel unit costs as compared to third quarter 2009's 7.11 cents, which excluded a charge related to the Company's 2009 early-out program.

"We are very pleased with the Customer response to our service to Panama City Beach, which commenced on May 24, 2010 with eight daily nonstop departures to four cities: Nashville, Houston Hobby, Orlando, and Baltimore/Washington," stated Kelly.

"During the quarter, we also celebrated the one-year anniversary of our successful introduction of the Southwest brand to the New York market out of LaGuardia, and we announced our intent to serve South Carolina with service to Charleston and Greenville-Spartanburg in 2011.

"Given the current economic outlook and trends, we continue to approach route expansion through optimizing our flight schedule rather than fleet growth. We remain committed to reaching our financial targets before we return to any significant level of fleet growth. For 2010, our capacity will remain essentially flat with last year.

For 2011, we are estimating a modest year-over-year capacity increase with no fleet growth.

Although it is too early to commit, at present, we have no plans to grow the fleet in 2012, either. We will continue to monitor trends for changes and are prepared to adjust our schedule, accordingly."

The Company has updated its schedule to replace its 737 Classic fleet to improve its operational and economic efficiency and, accordingly, also updated its future firm orders and options with the Boeing Company with no net change to its fleet plans.

The Boeing schedule revisions included conversion of six purchase rights to 2014 options, acceleration of three options (two from 2015 to 2013; one from 2016 to 2014), and exercise of 25 737-700 options for firm delivery in 2011 through 2016.

In addition, the Company now has 98 purchase rights through 2021.

Southwest Airlines buys 25 737-700s

Southwest Airlines has revealed itself as the unnamed buyer of 25 737-700 aircraft. Boeing had already listed the deal on its orderbook at a price of between $58.5m and $69.5m per aircraft but had withheld the
carrier’s name.

The airline will introduce the aircraft to replace older 737s, keeping its fleet at 544 aircraft.

The new aircraft will be delivered to the airline from 2011 through to 2016. Southwest has options to buy 98 additional aircraft through 2021 but has said that it will not expand its fleet until travel demand
increases.

Southwest Airlines Co. (NYSE: LUV) announced today that the Company flew 7.5 billion revenue passenger miles (RPMs) in July 2010, a 3.4 percent increase from the 7.2 billion RPMs flown in July 2009.

Available seat miles (ASMs) increased 1.4 percent to 8.8 billion from the July 2009 level of 8.7 billion.

The load factor for the month was 84.9 percent, a record monthly load factor performance for the Company.

For July 2010, passenger revenue per ASM is estimated to have increased in the 17 to 18 percent range as compared to July 2009.

For the seven months ended July 31, 2010, Southwest flew 44.9 billion RPMs, compared to 43.8 billion RPMs flown for the same period in 2009, an increase of 2.4 percent.

Available seat miles decreased 2.6 percent to 56.9 billion from the 2009 level of 58.4 billion.

The year-to-date load factor was 78.8 percent, compared to 75.0 percent for the same period last year.

Southwest Closer To 737-800 Decision

The union for Southwest Airlines flight attendants has reached a tentative agreement with the carrier on pay rules and working conditions related to the use of larger aircraft, clearing one obstacle to an airline decision on whether to obtain Boeing 737-800s—assuming union members approve the deal.
The Transport Workers Union Local 556 says members will complete their vote no later than Dec. 1—Southwest’s self-imposed deadline for making a decision about the 737-800 to ensure it could get the first deliveries in 2012. The union’s executive board has unanimously approved the tentative deal.
The union says the tentative agreement ensures that the attendants’ contractual variable pay increase, which is tied to the company's 2010 financial performance, will not be less than 2%. The agreement also calls for company-paid training, the formation of a labor-management committee to address any ongoing work rule issues, and a one-year contract extension, the union says.
The extension would make the contract amendable as of May 31, 2013.
Southwest says the tentative deal moves it closer to a decision on the 737-800, but notes that it also needs to reach an agreement with its pilots union. Southwest says it also is still evaluating whether adding the bigger aircraft makes sense.
Under federal rules on aviation safety, any aircraft with more than 150 seats must have a fourth attendant, which is one reason Southwest has shunned the bigger aircraft in the past. Among the issues the labor-management committee for attendants would address are scheduling and bidding procedures that will be required for having a fourth flight attendant on board the bigger aircraft.
Southwest currently operates 737-300, -500 and -700 series aircraft with 122 to 137 seats. But it says it is considering the larger aircraft, and the added crew costs that would come with it, because of the potential advantages: allowing for additional capacity in high-demand, slot-controlled or gate-restricted markets, such as New York LaGuardia, Minneapolis-St. Paul or Boston.
Southwest said Sept. 15 that it is “continuing to evaluate network and configuration options” for the 737-800.”
“As such, any details regarding firm orders with Boeing, timing, and quantity of deliveries are still to be determined,” it added.

Southwest to acquire AirTran Airways

Southwest is to further consolidation in the US industry through the acquisition of fellow low-fare carrier AirTran Airways.
In a definitive agreement endorsed by both the boards of both airlines, Southwest is purchasing all outstanding common stock of AirTran's parent for a combination of cash and stock.
Under the agreement each share of AirTran common stock will be exchanged for $3.75 in cash and 0.321 shares of Southwest's common stock. Including AirTran's debt and capitalized aircraft operating leases, the transaction is valued at $3.4 billion.
Through the agreement Southwest gains key access to Washington National Airport and expands its presence in other key markets including New York LaGuardia and Boston. It also furthers Southwest's goals of serving near international destinations through AirTran's leisure markets in the Caribbean.
Until closing Southwest and AirTran will continue to operate as separate brands. Southwest plans to integrate AirTran's Boeing 737s and 717s into its own 737 livery and consolidating corporate functions at its Dallas headquarters.
The two carriers also plan to transition to a single operating certificate and will operate a combined fleet of 685 aircraft. As of 30 June the combined unrestricted cash of the two airlines was $3.7 billion

AirTran Deal Solves SWA Growth Plans

Southwest Airlines’ proposed merger with AirTran Airways sets up the low-cost giant’s growth plans for the next decade, and allows it to add both small U.S. markets and international destinations to its network.
The deal, valued at $1.4-billion in stock and cash, will also create a domestic powerhouse that will rival the world’s largest operators in size of fleet and employees, if approved by regulators and shareholders,
With 685 active aircraft, the new airline will serve more than 100 million passengers from more than 100 airports with 43,000 employees. Annual synergies are estimated at $400 million by 2013, with one-time costs ranging between $300 and 500 million. But, according to Southwest Chief Executive Gary Kelly, this is only the initial benefit of this merger.
“This fits beautifully for the strategy we have laid out for the next 10 years,” Kelly said during an analyst call broadcast online. “It allows us to progress in the evolution of our fleet. We are not just acquiring AirTran; this sets the stage for us to resume growth with the necessary profits in place.
“We have small overlap, which creates new fleet and route opportunities for us,” he added.
Kelly, who noted that a more in-depth review of its strategy will be released in the next three months, would not discuss many specifics, although he regularly “assumed” that Southwest will for now retain its single-class product, and has no plans to assign seats or offer the dual class cabin provided by AirTran.
Importantly, Southwest’s top executive made note of the growth potential for AirTran’s Atlanta hub, an airport one analyst noted had little new capacity under AirTran’s latest expansion plan. “This is about Atlanta,” said Kelly. “We can bring more low fares to many new markets,” he continued, noting that a study by Campbell-Hill Aviation Group indicates Southwest could stimulate over two million new passengers and over $200 million in consumer savings, annually, at the airport, which is also home to Delta.
Southwest also notes growth opportunities at Washington Reagan National Airport, and “key markets” such as New York LaGuardia, Boston Logan and Baltimore/Washington International Thurgood Marshall Airport.
“We are at a point where we are not growing our route network organically,” said Kelly. BWI, where there is most overlap between the two networks, will not necessarily grow, but there are also no plans to reduce capacity either, he added.
For now Southwest says it intends to keep AirTran’s network and fleet intact, including the smaller communities that are served by the target carrier’s 86 Boeing 717s. “When you look at the next few years we have no growth. This [merger] improves our profit outlook measurably,” says Kelly, again noting the potential of AirTran’s access to small communities and international markets close to the U.S.
Kelly also pointed to the 51 737-700 orders and options currently held by AirTran, although he issued the caveat that the AirTran’s 52 737-700s give the combined entity some freedom to allocate aircraft across a larger network.
That combined fleet will consist of 401 Boeing 737-700s, 173 Boeing 737-300s, 25 Boeing 737-500s, and the 86 Boeing 717s.
Importantly, Southwest’s release announcing the proposal also notes that the deal “supports Southwest Airlines’ evaluation of the Boeing 737-800,” that could bring longer-haul services to the carrier’s network.
International growth, however, will require a new reservation system, although Southwest has already narrowed its search to two providers.
There are still many aspects that need to be addressed by a recently created integration team, notably staff integration, although management notes that seniority issues are a union issue and will not necessarily hinder the merger. However, Southwest Executive VP for Strategy and Planning Robert Jordan emphasized that the 717 crews will be “fenced off” from their 737 colleagues.
Shareholder and regulatory approvals are also required, although these are not expected to delay the process, which could see AirTran becoming a Southwest subsidiary in 2011 and fully integrated under a single air operator certificate with two years.
AirTran shareholders, especially, will benefit from the 69% premium on their shares as of Sept. 24, noted Southwest CFO Laura Wright.

Southwest Airlines flew 6.1 billion RPMs in September, up 5.1% from the year-ago month.

Capacity increased 4.7% to 8.1 billion ASMs and load factor rose .3 point to 75%.

Southwest Airlines posts $205M profit for 3Q
DALLAS — Southwest Airlines Co. is making money as more people travel on the nation's largest discount airline.
Southwest said Thursday it earned $205 million in the July-through-September quarter.
Traffic was up about 5 percent, which along with higher average fares pushed revenue up 20 percent.
CEO Gary Kelly said the outlook for October is excellent too. He predicted revenue per passenger will rise in the fourth quarter even though that's usually a slow period for travel, other than the December holidays.
Dallas-based Southwest joined United, Continental, Delta, American, US Airways and JetBlue in posting third-quarter profits as the airlines benefited from higher fares and growing travel demand coming out of the recession. Combined, the leading U.S. airlines earned more than $2 billion in the quarter.
The airlines have helped themselves by limiting available seats, which makes flights more crowded and drives up fares. Southwest has set monthly records for high occupancy in 14 of the last 15 months.
After shrinking last year, Southwest has been adding flights in recent months, and it laid out plans Thursday to grow aggressively early next year. It figures to operate about 8 percent more flights in the first quarter of 2011 than it did in the same period this year.

Southwest CEO Wants Boeing To Re-Engine 737 For Efficiency

DALLAS, Texas (Dow Jones)--Southwest Airlines Co. (LUV) Chief Executive Gary Kelly said he wants Boeing Co. (BA) to re-engine the 737 for better fuel efficiency, voicing skepticism Boeing will produce a timely replacement for the workhorse aircraft.
"Fuel prices are a game-changer," Kelly said in an interview after the company's media day event at its headquarters. "We need a more fuel-efficient, cost-effective airplane."
He called Boeing "a very fine partner" but said Southwest eventually might be forced to consider competitors' offerings if it isn't satisfied with its options.
"If Boeing doesn't have a solution, we will have to think about that," Kelly said. "But at this time, we're not talking to anyone" else.
Kelly said Boeing has told Southwest that is assessing plans for a 737 replacement but hasn't been precise on the timing. He described himself as "skeptical" regardless, because "we've been talking to them for years" with no firm replacement plans.
Boeing has informed Southwest that it will make a decision by the end of the year regarding whether to re-engine the 737 in the interim, Kelly said.

Jeannot a écrit:Le CEO de Southwest semble souhaiter une remotorisation du 737.

Southwest CEO Wants Boeing To Re-Engine 737 For Efficiency

DALLAS, Texas (Dow Jones)--Southwest Airlines Co. (LUV) Chief Executive Gary Kelly said he wants Boeing Co. (BA) to re-engine the 737 for better fuel efficiency, voicing skepticism Boeing will produce a timely replacement for the workhorse aircraft.
"Fuel prices are a game-changer," Kelly said in an interview after the company's media day event at its headquarters. "We need a more fuel-efficient, cost-effective airplane."
He called Boeing "a very fine partner" but said Southwest eventually might be forced to consider competitors' offerings if it isn't satisfied with its options.
"If Boeing doesn't have a solution, we will have to think about that," Kelly said. "But at this time, we're not talking to anyone" else.
Kelly said Boeing has told Southwest that is assessing plans for a 737 replacement but hasn't been precise on the timing. He described himself as "skeptical" regardless, because "we've been talking to them for years" with no firm replacement plans.
Boeing has informed Southwest that it will make a decision by the end of the year regarding whether to re-engine the 737 in the interim, Kelly said.

[Vous devez être inscrit et connecté pour voir ce lien]

C'est contre cette toile de fond qu'il faut situer les remarques ci-dessus , nous semble -il !

Southwest Airlines believes re-engining of existing narrowbodies is fast becoming the only option for airlines looking for a 15% cost benefit as fresh narrowbody designs will not emerge until after 2020.

"I think what is going to happen is that the decision is almost going to be made for us," Southwest executive vice president of strategy and planning Bob Jordan tells ATI. "We're 12 or more years away [from a new narrowbody design], and we cant' wait that long for a step change in aircraft costs."

Jordan says if a re-engined option emerges much sooner that creates a significant cost benefit, "what happens is you de facto end up with a decision because it is the only option in any reasonable amount of time".

He says Southwest hasn't made a firm decision on re-engining, but "personally I would be very surprised if re-engining isn't the option we pursue".

Jordan also believes manufacturers need to conmnmit to the 12%-15% step change in efficiency a re-engined narrowbody could deliver. "Boeing is a fantastic partner, but we need both our engine manufacturer GE and Boeing to step up and take the lead."

• GE capable de réussir 15% de gains en "fuel-burn efficiency" (il n'a pas dû lire James BELL ! ) ;
  
• Boeing capable d'adapter les actuels airframes à un stade technologique qui leur permette de tirer la quintessence de ce que les moteurs peuvent offrir.
  

Southwest & Boeing – Some Thoughts
This past week we were part of Media Day at Southwest Airlines. It was a most pleasant visit. However, news reports coming out of the event bear some scrutiny.

Item 1 – Bob Scheler from Dow Jones reported: “Southwest Airlines Chief Executive Gary Kelly said he wants Boeing Co. to re-engine the 737 for better fuel efficiency, voicing skepticism Boeing will produce a timely replacement for the workhorse aircraft.
“Fuel prices are a game-changer,” Kelly said in an interview after the company’s media day event at its headquarters. “We need a more fuel-efficient, cost-effective airplane.”
He called Boeing “a very fine partner” but said Southwest eventually might be forced to consider competitors’ offerings if it isn’t satisfied with its options.
“If Boeing doesn’t have a solution, we will have to think about that,” Kelly said. “But at this time, we’re not talking to anyone” else.
Kelly said Boeing has told Southwest that is assessing plans for a 737 replacement but hasn’t been precise on the timing. He described himself as “skeptical” regardless, because “we’ve been talking to them for years” with no firm replacement plans.”

Item #2 – Lori Ranson from ATI reported: “Southwest Airlines believes re-engining of existing narrow-bodies is fast becoming the only option for airlines looking for a 15% cost benefit as fresh narrow-body designs will not emerge until after 2020.
“I think what is going to happen is that the decision is almost going to be made for us,” Southwest executive vice president of strategy and planning Bob Jordan tells ATI. “We’re 12 or more years away [from a new narrow-body design], and we cant’ wait that long for a step change in aircraft costs.”
Jordan says if a re-engined option emerges much sooner that creates a significant cost benefit, “what happens is you de facto end up with a decision because it is the only option in any reasonable amount of time”.
He says Southwest hasn’t made a firm decision on re-engining, but “personally I would be very surprised if re-engining isn’t the option we pursue”.
Jordan also believes manufacturers need to commit to the 12%-15% step change in efficiency a re-engined narrow-body could deliver. “Boeing is a fantastic partner, but we need both our engine manufacturer GE and Boeing to step up and take the lead.“

Item #3 – We had an interview with Mike Van de Ven (Southwest’s EVP and COO) which provided another view. It was clear from our conversation he echoed the Southwest view that their relationship with Boeing is 39 years old and is very important. He went on to provide some context to an earlier interview he had given to [Vous devez être inscrit et connecté pour voir ce lien]. In our conversation he clarified that waiting until 2025 was not an option, he feels that the airline needs a solution “sometime before 2020″. We pressed on to confirm that Southwest is looking for a “step change”. He said that the airline needs better economics and an airplane is a good way to get these better economics. Consistent with his colleagues, he expressed a concern with fuel prices. He feels they cannot wait 15 years for the step change. He pointed out that post the AirTran acquisition, with 684 planes, they cannot flip the fleet quickly. For a new airplane he “would dream big” – and look for a 20% to 25% improvement in ownership costs.
He then went on to point out that in a higher fuel cost environment, flying smaller gauge airplanes becomes more difficult. Southwest’s business model is built on frequency. The airplane they would look at is “around 120 to 150 seats”. He also pointed out that as the airline evolves so will the fleet strategy. But looking forward at “lower tier markets” and “slot controlled markets” there appears to be room for a mixed fleet. He mentioned that if he had “50 or a 100 – of a type” you can get efficiencies. He then said they will try to make the 717s work, and he thinks the leases on the (AirTran) planes run through 2024. So Southwest could be operating the 717s for more than a decade yet.
This led to talking about the CSeries which he called “an interesting airplane”. “If it executes as it’s marketed, it’s a nice airplane.” He likes the numbers. He thinks it is an option for Southwest. He immediately added that this is what they are asking Boeing – “what are the options?” He said that Southwest and Boeing’s thinking are “very much aligned.” This again is consistent with his colleagues.
He described the CSeries and C919 as “a little bit disruptive.” When asked directly if Southwest would consider something other than a Boeing product, he responded Boeing has “been a great partner” and the preference is to first hear what Boeing has to say. He wants to hear what Boeing will say about a replacement or a re-engine.

So now what?
From these three interviews with senior executives what we are hearing consistently is that Southwest is strongly Boeing oriented. That means that whatever Boeing has to offer will be given a sympathetic ear. Clearly the airline and OEM have deep relationships. It is useful to point out that speakers at the Media Day event said the same thing in many different ways; but it was consistent. This airline is focused on relationships – among employees, with customers and vendors. It is a significant cultural thing for Southwest.
Here are some key drivers we know of the airline’s fleet desire:

• Southwest has a “sweet spot” at around 149 seats. One more seat means another flight attendant and more cost.
  
• They want an airplane that can do lots of daily cycles. Frequent daily service in every market is their modus operandi.
  
• They are looking for 20% minimum improvement in costs.
  

Will Southwest ever look at Airbus seriously? Assuming Boeing has nothing to offer in time and Airbus offers the NEO, there could be a credible offering. We heard a great story while visiting about legendary Herb Kelleher contacting Airbus every few years to ask for 20 cigarette lighters. These lighters were then handed out to the visiting Boeing sales team at the start of negotiations. (It would seem fair to think of Ryanair in the same light. Between Southwest and Ryanair, they are both Boeing dependent.)
At the same time Southwest has to be aware that Boeing’s Jim Albuagh has remarked that the sweet spot for the 737 is now 180 seats, or nearly the size of the 737-900. This way bigger than Southwest is considering. There is likely to be Southwest order for 737-800s by December 2010, though. But that airplane has specific uses; slot-constrained airports and Hawaii. So while outside Southwest’s sweet spot, there are specific requirements. As the airline has grown its fleet has to evolve beyond its standard to date.
Boeing has so far made it clear that it does not like the idea of re-engining the 737. But Southwest likes this idea as a near-term solution. Consider this a small opportunity for change. Next Boeing has made numerous statements that a 737 replacement is likely to come after 2019-2020. Southwest does not (and perhaps will not) wait that long. And CEO Gary Kelly expressed his doubts about that as seen above. Consider this another small opportunity for change.
What is clear from the people who visited Southwest Airlines last week is that the airline is looking at Boeing for ideas and a solution. It has been quite vocal about what it is looking for. The next “buy” will be for 737-800s and this will occur very soon. But, even with its loyalty to Boeing, based on nearly four decades of relationships, Southwest Airlines wants and needs a broader fleet solution before 2020. Is Boeing going to blink?
Unlike Southwest, which is manifestly Boeing’s customer to lose, we think Ryanair will mercilessly shop its fleet needs. If either of these two airlines decide to buy something else than a Boeing product the knock on effects will be significant.

Jeannot a écrit:AirInsight : Réflexion sur les relations SoutWest Boeing

Southwest & Boeing – Some Thoughts
........
Item #3 – We had an interview with Mike Van de Ven (Southwest’s EVP and COO) which provided another view. It was clear from our conversation he echoed the Southwest view that their relationship with Boeing is 39 years old and is very important. He went on to provide some context to an earlier interview he had given to [Vous devez être inscrit et connecté pour voir ce lien]. In our conversation he clarified that waiting until 2025 was not an option, he feels that the airline needs a solution “sometime before 2020″.

We pressed on to confirm that Southwest is looking for a “step change”. He said that the airline needs better economics and an airplane is a good way to get these better economics. Consistent with his colleagues, he expressed a concern with fuel prices. He feels they cannot wait 15 years for the step change. He pointed out that post the AirTran acquisition, with 684 planes, they cannot flip the fleet quickly. For a new airplane he “would dream big” – and look for a 20% to 25% improvement in ownership costs.

......He then said they will try to make the 717s work, and he thinks the leases on the (AirTran) planes run through 2024. So Southwest could be operating the 717s for more than a decade yet.

This led to talking about the CSeries which he called “an interesting airplane”. “If it executes as it’s marketed, it’s a nice airplane.” He likes the numbers. He thinks it is an option for Southwest. He immediately added that this is what they are asking Boeing – “what are the options?” He said that Southwest and Boeing’s thinking are “very much aligned.” This again is consistent with his colleagues.
He described the CSeries and C919 as “a little bit disruptive.” When asked directly if Southwest would consider something other than a Boeing product, he responded Boeing has “been a great partner” and the preference is to first hear what Boeing has to say. He wants to hear what Boeing will say about a replacement or a re-engine.

So now what?
From these three interviews with senior executives what we are hearing consistently is that Southwest is strongly Boeing oriented. That means that whatever Boeing has to offer will be given a sympathetic ear. Clearly the airline and OEM have deep relationships. It is useful to point out that speakers at the Media Day event said the same thing in many different ways; but it was consistent. This airline is focused on relationships – among employees, with customers and vendors. It is a significant cultural thing for Southwest.

Here are some key drivers we know of the airline’s fleet desire:

• Southwest has a “sweet spot” at around 149 seats. One more seat means another flight attendant and more cost.
  
• They want an airplane that can do lots of daily cycles. Frequent daily service in every market is their modus operandi.
  
• They are looking for 20% minimum improvement in costs.

Will Southwest ever look at Airbus seriously? Assuming Boeing has nothing to offer in time and Airbus offers the NEO, there could be a credible offering. We heard a great story while visiting about legendary Herb Kelleher contacting Airbus every few years to ask for 20 cigarette lighters. These lighters were then handed out to the visiting Boeing sales team at the start of negotiations. (It would seem fair to think of Ryanair in the same light. Between Southwest and Ryanair, they are both Boeing dependent.)

Content d'apprendre l'anecdote ! Mais, quoi d'autre de nouveau sous le soleil ? ;)

At the same time Southwest has to be aware that Boeing’s Jim Albuagh has remarked that the sweet spot for the 737 is now 180 seats, or nearly the size of the 737-900. This is way bigger than Southwest is considering. There is likely to be Southwest order for 737-800s by December 2010, though. But that airplane has specific uses; slot-constrained airports and Hawaii. So while outside Southwest’s sweet spot, there are specific requirements. As the airline has grown its fleet has to evolve beyond its standard to date.

Boeing has so far made it clear that it does not like the idea of re-engining the 737.

But Southwest likes this idea as a near-term solution. Consider this a small opportunity for change. Next Boeing has made numerous statements that a 737 replacement is likely to come after 2019-2020. Southwest does not (and perhaps will not) wait that long. And CEO Gary Kelly expressed his doubts about that as seen above. Consider this another small opportunity for change.

What is clear from the people who visited Southwest Airlines last week is that the airline is looking at Boeing for ideas and a solution.

It has been quite vocal about what it is looking for. The next “buy” will be for 737-800s and this will occur very soon. But, even with its loyalty to Boeing, based on nearly four decades of relationships, Southwest Airlines wants and needs a broader fleet solution before 2020. Is Boeing going to blink?

Unlike Southwest, which is manifestly Boeing’s customer to lose, we think Ryanair will mercilessly shop its fleet needs. If either of these two airlines decide to buy something else than a Boeing product the knock on effects will be significant.

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Southwest transforme 20 B 737-700 en 20 B 737-800. Explications :

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Southwest
Airlines chief executive Gary Kelly announced on Wednesday that the
carrier will get the larger Boeing 737-800 aircraft starting in March 2012.

The Dallas-based carrier said it will substitute 20 of its 737-700 orders with the aircraft manufacturer for the -800 planes.

"The -800 represents many exciting opportunities for our employees and customers," Kelly said.

"We are looking to the future and the -800 sets the stage to bring more destinations into the realm of
possibilities
for Southwest, to operate a more economical aircraft, and to offer
better scheduling flexibility in high-demand, slot-controlled, or
gate-restricted markets."

Southwest has said it
could use the -800 series, which has 175 seats, to fly more passengers
in and out of some its slot-constricted airports such as New York's
LaGuardia airport. The carrier will also be able to fly longer distances
to destinations in Hawaii and near-international cities.

Last
month, Southwest's pilots and flight attendants unions ratified new
contracts that would allow the carrier to operate the -800 aircraft.

Southwest's Kelly Pushes for Boeing Decision on New 737 Engines

[Vous devez être inscrit et connecté pour voir ce lien] increased pressure on [Vous devez être inscrit et connecté pour voir ce lien] to upgrade its top-selling 737 model with more fuel-efficient engines, as Airbus SAS did with a competing plane, because waiting a decade for an all-new jet is too long.
“When you talk about something that’s 10 years from now, that’s not a solution, that’s an idea,” Southwest Chief Executive Officer [Vous devez être inscrit et connecté pour voir ce lien] said in an interview in New York. “Who among us is to say it won’t be 15 years from now? In the meantime, we’re going to spend $40 billion on fuel.”
Southwest is the biggest operator of the single-aisle 737, a competitor of the Airbus A320, which Boeing has said may not be replaced with an all-new model before 2020. While Airbus said Dec. 1 that it would offer new engines on its narrow-body plane, Boeing has delayed a decision on the 737 until 2011 after initially planning an announcement this year.
[Vous devez être inscrit et connecté pour voir ce lien] of 544 aircraft, which Kelly plans to maintain by retiring older planes as new ones are added, consists solely of 737s. The CEO said that he’s willing to wait “to a point” for Boeing to decide on offering a new engine before he looks at alternatives.
“I don’t feel any issue today, that we have to have an answer today,” he said. “In the meantime if there are real things that are alternatives, one is forced to look at that. We are very supportive of their efforts. There is no implied criticism here. At all.”
Capacity Increase
Fuel accounted for 33 percent of Southwest’s total operating expenses in the first nine months of 2010, and a plane with about 15 percent higher fuel efficiency would help cut costs.
The Dallas-based carrier will increase capacity 3 percent to 5 percent in 2011, excluding the fleet from its acquisition of AirTran Holdings Inc., Kelly said in a speech today in New York. Southwest said it has completed plans to convert 20 existing aircraft orders to Boeing 737-800s from -700s, with initial deliveries expected in 2012.
The more fuel-efficient and larger -800 will enable Southwest to carry more people on high-demand routes and allow flights to destinations such as Hawaii, Central America and the Caribbean.
Chief Operating Officer [Vous devez être inscrit et connecté pour voir ce lien] said in October that Southwest was “indifferent” on whether Chicago-based Boeing chose to offer an all-new successor to the 737 or a modified version with new engines. That was before Airbus unveiled its plan for the upgraded A320, which it called the A320 NEO.
‘Material Event’
“The Airbus NEO announcement is a material event and that has to be factored in,” Kelly said. “We may need to understand -- may being a key word -- in depth what that’s all about.”
Boeing has said it would prefer to focus on a new jet because customers don’t see a business case for the interim- engine step.
“We’ll do our studies, work with customers, see what their requirements are, and at such time that we’re satisfied we’re doing right by our customers and by the market, then we’ll make that decision,” [Vous devez être inscrit et connecté pour voir ce lien], a Boeing spokesman in Seattle, said today.
“If we decide that re-engining is the way to go, that would be in service around the middle of the decade,” Brabant said. “We’ve heard both ways from customers, that some are in favor of a new engine and some in favor of a new airplane.”
‘Something Gary Kelly Likes’
Whatever decision Boeing makes, it will be “something that Gary Kelly likes,” [Vous devez être inscrit et connecté pour voir ce lien], chief of Boeing’s commercial airplanes division, said in July.
The new power plants Airbus is offering are made by United Technologies Corp.’s [Vous devez être inscrit et connecté pour voir ce lien] and CFM International, a joint venture between [Vous devez être inscrit et connecté pour voir ce lien] and France’s Safran SA.
Bombardier Inc.’s new CSeries, which seeks to compete with the smallest of the A320 models, also offers the new Pratt & Whitney engine, the PurePower geared turbofan. The 737 now operates on only CFM engines.
While new engines promise to cut fuel consumption by about 15 percent, the savings on direct costs to airlines would translate into just half that amount as fuel is only part of the cost in operating planes. Another compromise is a likely cut to payload or range, because the new engines are heavier.
Landing Gear
Fitting different engines under a 737’s wing would be more challenging for Boeing because the aircraft already sits so close to the ground that the landing gear would need to be redesigned to allow enough clearance.
The planemaker began testing tweaks to its existing 737 last month that would make the plane 2 percent more fuel- efficient by the middle of next year.
“We want something better than we’ve got,” Kelly said. “Pratt & Whitney has an engine that’s more fuel efficient. GE has an engine that’s not far behind. What’s the plan? You’ve got an answer from Airbus, you’ve got an answer from Bombardier. And we need a means to reduce our fuel bill and our carbon emissions.”

Southwest doesn’t rule out fleet type expansion beyond the 717

Southwest Airlines is acknowledging that it may have to consider additional fleet types beyond the Boeing 717 operated by AirTran Airways, which Southwest in the process of acquiring.
In September when Southwest unveiled its plans to purchase its low-fare rival AirTran, Southwest chief executive Gary Kelly stated the 86 717s AirTran currently operates offer enough scale for Southwest to incorporate them in its fleet effectively.
During Southwest's recent investor day carrier chief operating officer Mike Van de Ven explained the carrier's single fleet philosophy was "one of those bellwether things that we've talked about, that has given us a lot of operational advantage".
But Van de Ven also acknowledges that "at some point a new airplane is going to come out, whether it's the CSeries, or whether Boeing replaces the 737. And at some point in time, Airbus is going to replace the A320".
Van de Ven says that as the 717 comes online and the new types are introduced, "we are going to have to be good at doing that [operating more than one fleet type]".
He stresses that shouldn't be interpreted at Southwest deciding to operate multiple fleet types. "I think, depending on what the mission of the airplanes is, maybe two, maybe up to three. I don't know," Van de Ven explains.

Southwest Airlines Co. (NYSE: LUV) announced today that the Company flew 6.6 billion revenue passenger miles (RPMs) in December 2010, an 11.3 percent increase from the 6.0 billion RPMs flown in December 2009.

Available seat miles (ASMs) increased 5.6 percent to 8.3 billion from the December 2009 level of 7.8 billion.

The load factor for the month was 80.4 percent, compared to 76.2 percent for the same period last year.

For December 2010, passenger revenue per ASM is estimated to have increased approximately five percent as compared to December 2009.

For the fourth quarter 2010, Southwest flew 20.0 billion RPMs, compared to 18.2 billion RPMs flown for the same period in 2009, an increase of 10.1 percent.

Available seat miles increased 5.5 percent to 24.8 billion from the fourth quarter 2009 level of 23.5 billion.

The fourth quarter 2010 load factor was 80.7 percent, compared to 77.3 percent for the same period last year.

For the year ended December 31, 2010, Southwest flew 78.0 billion RPMs, compared to 74.5 billion RPMs flown for the same period in 2009, an increase of 4.8 percent.

Available seat miles increased 0.4 percent to 98.4 billion from the 2009 level of 98.0 billion.

The year-to-date load factor was 79.3 percent, compared to 76.0 percent for the same period last year.

[Vous devez être inscrit et connecté pour voir ce lien] would consider buying Airbus aircraft for the first time if [Vous devez être inscrit et connecté pour voir ce lien] chooses not to develop a more fuel-efficient version of its leading single-aisle jet, the chief executive of [Vous devez être inscrit et connecté pour voir ce lien] has implied.

The suggestion will raise the pressure on Boeing to [Vous devez être inscrit et connecté pour voir ce lien] with a new, more fuel-efficient engine, rather than put its efforts into creating an entirely new version of the jet that could take substantially longer to bring to market.

If consummated the move would be a significant coup for [Vous devez être inscrit et connecté pour voir ce lien], the European conglomerate that owns Airbus. Southwest has a fleet of more than 500 aircraft but has stuck with a single type of Boeing jet for most of its history. A unified fleet helps it reduce maintenance and operating costs.

Last year, Airbus said that it would go ahead with a [Vous devez être inscrit et connecté pour voir ce lien], called the NEO. But the move has met with a mixed reception from airlines and aircraft leasing companies.

For Boeing, the dilemma is whether to introduce an “interim” model or to skip the round entirely by developing a completely new single aisle aircraft.

Gary Kelly, Southwest chief executive, said on Thursday that Boeing had indicated it would decide in mid-2011.

“Based on what they tell us I think we will have to evaluate our options like any business people,” Mr Kelly told investors. “If they told us we will not see a more fuel-efficient 737 for 20 years that would probably cause us to do something.”

• le bla-bla de P&W, sur le GTF / PurePower,
  
  
• et la capacité d'Airbus à assurer une date / période d'EIS, aussi proche que 2016, ou même 2016 / 2017 (comme tout le monde, .... Southwest voit un première date en 2018 .., ... pour l'opération NEO ), ...