Southwest Airlines Co. reported a 42% rise in profit for the second-quarter and said it plans to resume capacity growth next year and resume fleet expansion as soon as it meets its long-term financial return target. Southwest said it could hit its long-term profitability target as early as next year. If so, expansion will require that more pilots be hired in the midst of a growing pilot shortage.
In a recent interview Mr. Kelly said that with the exception the deductions of some special items that there was a 140% rise in profits for the 2nd quarter. He also said that demand is very strong and that he expects that Southwest will have a good third quarter also.
“We are producing very strong results despite a fragile economic environment,” said Chief Executive Gary Kelly in a statement. He also noted that the drastic increase in profit was earned in spite of the fact that oil prices, while lowered recently, are still are very high.
“Record revenues driven by steady growth were sufficient to overcome high jet fuel prices,” Mr. Kelly said in the statement.
Southwest’s expansion plans have been slowed while they struggle with the integration of AirTran Airways and the transformation of their infrastructure that will allow it to operate international flights for the first time.