Southwest Airlines Boeing 737 airliner taxi on December 13, 2024, along the tarmac at the Washington National Airport (DCA) in Arlington, Virginia.
Daniel Slim | AFP | Getty Images
Southwest Airlines On Monday, he said it had cut about 15% of corporate jobs, or about 1,750. This is a CEO called “unprecedented” so that the company can scramble to reduce costs.
The company said it expects a $210 million cut this year and a roughly $300 million cut in 2026. The layoffs will take place by the end of the second quarter and include several senior leadership roles, CEO Bob Jordan said in a staff memo. Seen by CNBC.
“This decision is unprecedented in its 53-year history and changes require difficult decisions,” Jordan said in a news release. “We are in a pivotal moment as we transform Southwest Airlines into a faster, faster, more agile organization.”
The decision to cut jobs in Southwest comes months after a settlement with activist investor Elliott Investment Management. The company also pushed for Jordan to be replaced as CEO, but it had not been successful.
Other recent cost-saving measures at Southwest include employment freezes, a suspension to internship programs, and the end of the company’s tradition, “Rallies,” dating back to 1985. We also actively reduced routes that were not adopted.
Last year, Southwest outlined plans to increase profits, including dumping more than 50 years of open seat models in favor of allotted seats and creating sections in the extra legroom. It also recently launched its first overnight flight.
“We need to have a lean organizational structure that funds the right work, reduces overlapping efforts, and promotes clarity, pace and urgency,” Jordan said in a memo on Monday. Ta.
The layoffs came into effect in late April, adding that most affected employees will not work, but will receive salaries, benefits and bonuses until then.
