Southwest Airlines has announced its intention to lay off approximately 15% of its corporate staff. This decision has been described by its CEO as “unprecedented,” amid the company’s efforts to reduce costs. Most of the layoffs will take place at the end of the second quarter of the year.
Why is Southwest Airlines laying off employees?
Southwest’s decision to reduce its workforce comes several months after reaching an agreement with activist investor Elliott Investment Management, which received five seats on the airline’s board, though it did not gain full control.
In a statement, the company highlighted that it is at a decisive stage, working to become a more efficient, faster, and more agile organization.
“This decision is unprecedented in our 53 years of history, and the change requires us to make tough decisions,” said CEO Bob Jordan.
These adjustments are expected to generate savings of $210 million this year and approximately $300 million by 2026, he added.
Among the recent cost-cutting measures implemented by Southwest are hiring freezes, the suspension of its internship program, and the elimination of team meetings. Additionally, the airline has taken drastic measures by cutting unprofitable routes.
In 2024, Southwest introduced a plan aimed at increasing profits, which included eliminating its open seating model, which had been in place for over 50 years, and introducing assigned seating, along with a section offering more legroom.
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How many employees will Southwest Airlines lay off?
According to the company, it plans to cut 15% of its workforce, which equates to 1,750 employees, including some senior leadership roles.
When will the layoffs at Southwest Airlines begin?
The layoffs will take effect at the end of April 2025.
What will happen to the laid-off employees at Southwest Airlines?
According to CEO Bob Jordan, most of the employees affected by these layoffs will not work but will continue to receive their salary, benefits, and bonuses until April.
What is Southwest Vacations?
Southwest Vacations offers vacation packages that include flights, lodging, car rentals, and activities. The company has agreements with Apple Leisure Group (ALG) to manage and facilitate bookings, ticket issuance, hotel stays, car rentals, and airport transfers.
What types of vacation packages does Southwest Airlines offer?
You have the option to customize your package by either booking a full package (flight, hotel, and/or car rental) or simply selecting activities. Available options include:
- Length of stay
- Number of travelers
- Hotel preferences
- Points of interest
- Add-ons such as car rentals, theme park tickets, and other activities.
What is Rapid Rewards?
Rapid Rewards is Southwest Airlines’ loyalty program. Members of Rapid Rewards will earn points for every Southwest Vacations package they book. Points will be distributed after the vacation is completed.
Can I use Rapid Rewards points to book a Southwest vacation package?
Although it is possible to earn Rapid Rewards points when traveling with a Southwest Vacations package, these points cannot be used to purchase a package.
How do I request a refund from Southwest Airlines?
In certain situations, you may be eligible for a full or partial refund for unused lodging, ground transportation, and activities.
You can cancel your vacation online or by calling the Southwest Vacations customer service center. To cancel online, access your reservation from the reservation recovery page or log in to your Southwest Vacations account, then follow the instructions to cancel your booking.
If you choose to cancel, your eligibility for a refund will be limited. To request a refund, you must submit a refund form after canceling your reservation. If you cancel online, you will be provided with access to an online refund request form once your cancellation is confirmed.
If you decline Travel Protection and cancel your reservation, the value of the land/attractions portion of your reservation (after applicable penalties) will be provided in the form of a Southwest Vacations Travel Credit.
Depending on your refund, you may receive:
- Southwest flight credits
- Southwest vacation travel credits
- A refund to the original payment method. Eligible refunds are typically issued within 21 days.
