• Southwest Airlines will eliminate about 1,750 jobs, representing 15% of its corporate positions.
• The layoffs, which predominantly affect senior leadership, are expected to save the airline approximately $210 million this year.
• This marks the first broad layoffs in the company’s 53-year history, as it adapts to new financial pressures.
• The airline is also implementing changes to its seating policy and introducing red-eye flights to boost revenue.
• CEO Bob Jordan emphasized the necessity of these changes for the long-term agility and efficiency of the airline.

Southwest Airlines has announced plans to cut 15% of its workforce, equating to approximately 1,750 jobs, in an unprecedented move within its 53-year history. The layoffs primarily affect corporate positions, including the elimination of 11 senior leadership roles, such as vice presidents and higher-level executives, due to the need for the airline to transition into a more agile organization, as stated by the airline's CEO, Bob Jordan. The expected completion of these layoffs will occur by the end of June 2025.

This decision is deemed crucial as Southwest strives to enhance profitability and maintain competitiveness amid evolving industry challenges. The company recently discontinued its traditional open-seating policy, moving towards assigned seating to increase revenue streams, and has introduced red-eye flights, starting with its inaugural flight on Valentine's Day. These strategies come in response to pressure from investors, notably Elliott Investment Management, which has advocated for widespread changes within the company and for the replacement of Jordan as CEO.

The workforce reduction will generate estimated savings of about $210 million this year and $300 million next year. However, Southwest anticipates incurring a one-time cost of $60 million to $80 million to cover severance packages and other benefits for the affected employees. Despite previously enjoying a lengthy streak of profitability, the airline's costs have begun to surpass those of its competitors. Notably, Southwest remains the only major U.S. airline that has never filed for bankruptcy protection, underscoring its established resilience in a volatile market.

For more information on this significant change at Southwest Airlines, visit The New York Times, Newsweek, or SFGate.