Southwest Airlines to Cut 1,750 Corporate Jobs in First Mass Layoff

By Evans Momodu
2 minute digest
Published 09:21 UK(GMT), 18 February, 2025

Southwest Airlines announced on Monday that it will be laying off 15% of its corporate workforce, amounting to 1,750 employees. This marks the first mass layoff in the airline’s history arising from its financial struggles.

The job cuts, set to begin in April, will include high-level leadership positions, with 11 executive roles—vice presidents and above—being eliminated.

According to the company, these reductions are expected to save Southwest $210 million in 2025 and $300 million in 2026. However, the airline anticipates incurring a one-time charge between $60 million and $80 million for severance and other costs.

"As we work to transform our company, we are focusing on maximising efficiency and minimising expenses," CEO Bob Jordan wrote in a message to employees. He acknowledged the layoffs as a "difficult and monumental shift."

Southwest has faced financial turbulence in recent years. Activist investors have noted that the airline’s stock price has declined by more than 50% since early 2021. While Southwest exceeded analysts' expectations in its latest earnings report, much of the revenue growth was attributed to rising ticket prices.

In June 2024, hedge fund Elliott Investment Management acquired a $1.9 billion stake in Southwest and later pushed for major leadership and operational changes. As a result, Southwest is shifting from its long-standing open seating policy to assigned seating, which allows the airline to charge higher fares for premium seats.

The company also recently appointed a new chief financial officer, Tom Doxey, formerly the president of Breeze Airways. Meanwhile, Southwest’s current CFO, Tammy Romo, and chief administration officer, Linda Rutherford, will retire in April 2025.

The layoffs mark a stark departure from the company’s previous commitment to job security. In 2021, former CEO Gary Kelly highlighted Southwest’s record of never having a layoff, emphasizing the airline’s dedication to employees and customers.
Source: CNN
Image: ABC 12