Southwest CEO Says No Furloughs or Layoffs For Now

Southwest Airlines CEO Gary Kelly said in a Sunday letter to employees that, for the time being, the carrier will not furlough any employees.

“We have no intention of seeking furloughs, layoffs, pay rate cuts, or benefits cuts through at least the end of this year,” Kelly wrote in the letter, in which he said Southwest has “scrambled” to cut spending and raise cash in response to reduced travel due to the CCP (Chinese Communist Party) virus pandemic.

So far this year, Southwest lost $1.6 billion, with almost 95 percent of that coming in the second quarter, he said. According to recent reports, the companys second-quarter revenues fell 82.9 percent to $1.01 billion.

“That amount of losses for only one quarter almost wipes out our profits for an entire year,” Kelly wrote. “Because of the pandemic, almost no one flew in April, as you all witnessed.”

Kelly said in the letter that Southwest was burning through around $20 million per day and that the company “is in intensive care.” Vowing that cutting staff would be the “last thing we do to keep Southwest financially healthy and viable,” Kelly acknowledged the threat of layoffs and furloughs remains, noting that he “cant guarantee it will never happen, especially during these dark pandemic times.”

The number of new daily recorded COVID-19 cases has accelerated in the United States since the end of June, Worldometers data shows, although the count of new daily deaths attributed to the potentially deadly bug has dropped since its April peak of around 2,500 per day to around 1,000 a day, on average, in recent weeks.

Airlines have tried to reassure passengers on the safety of air travel during the outbreak, with large U.S. carriers recently announcing tougher policies on the wearing of masks. Southwest told customers last week that if they cant wear a mask, including for medical or disability reasons, they should not fly, with exemptions only applying to children under the age of two.

Southwests stricter mask-wearing mandate goes into effect July 27, with the company announcing it “regrets that we will be unable to transport the individual” in the event of passengers not meeting the new criteria. Travelers on the airline are allowed to remove their fRead More – Source