In a company first, Southwest Airlines announced it will lay off hundreds of workers at its headquarters in Dallas.
Never before in its more than half-century history has Southwest implemented a mass employee layoff like the one it announced on February 17. In total, 1,750 employees at Dallas Love Field HQ will be laid off, representing roughly 15% of the airline’s entire corporate staff.
“This decision is unprecedented in our 53-year history, and change requires that we make difficult decisions. We are at a pivotal moment as we transform Southwest Airlines into a leaner, faster, and more agile organization,” Bob Jordan, president, CEO, and vice chairman of the board of directors, said in a February 17 statement.
“I arrived at this decision thoughtfully and carefully, knowing how hard it will be to say goodbye to colleagues who have been a significant part of our Southwest Culture and accomplishments. I’m grateful to all Southwest Employees who have shared in our legendary history and to those that will guide us into the next era of Southwest Airlines.”
The changes come in the wake of numerous major shifts at Southwest. Last month, The Dallas Express reported that the airline was losing two top executives this April due to their retirement, signaling a major leadership transition at the company. With the latest announcement, 11 senior leadership positions were eliminated.
In December, the airline announced plans to end cabin service earlier on flights, citing safety risks. While flight attendants previously prepared for landing when the aircraft descended to 10,000 feet, the new rule mandates that the process start earlier, when it drops to 18,000 feet.
The changes and others, like offering redeye flights, are all a part of Southwest Airlines’ attempt to reduce costs.
“Nobody at headquarters is going to be sleeping well tonight if they sleep at all,” aviation expert Steve Cosgrove told WFAA after the mass layoffs were announced on Monday.
He added that the specific employees directly affected by the layoffs would be notified in person on Tuesday.
Southwest will reportedly save roughly $300 million per year due to the recent cost-reduction measures. However, Jordan has stated that he is aiming for half a billion dollars in savings, so more cuts could be on the horizon, the Dallas Business Journal reported.
“For more than 50 years we had that claim to fame; it…was always people first,” said aviation consultant and former Southwest spokesperson Ed Steward. “That’s why it’s such a big shock right now in the industry.”
Southwest Airlines trades under the ticker LUV on the New York Stock Exchange. Over the past year, shares of the company have fallen more than 12%. For comparison, the broad market, as represented by the S&P 500, has appreciated nearly 23% during that time.