Southwest Airlines (LUV) CEO Gary Kelly announced Wednesday that after more than 17 years at the helm he will step down next year and join the airline’s board as executive chairman. LUV stock fell.
Robert Jordan, the current vice president of corporate services, will succeed Kelly on Feb. 1, 2022.
Kelly, who has worked at Southwest for 35 years, said he would like to serve as the executive chairman through at least 2026, pending board approval.
Last month, Kelly said Southwest could need up to 500 new aircraft as it expands routes across the U.S.
“We’re going to have to acquire more airplanes to be able to restore the rest of our route network,” he told the Dallas Morning News. “And now that travel demand is coming back to life, we need to restore that capacity, and it will take us a while because we’ve diverted airplanes to these new markets.”
In March, Southwest ordered 100 more 737 Max jets. In total, the carrier has over 300 Boeing jets on order and options for over 100 more.
Any new planes will be Boeing 737 jets.
“We’re not thinking about another airplane at all,” Kelly told the Dallas Morning News. Southwest had reportedly been considering the Airbus (EADSY) A220 before deciding on the Boeing 737 Max jet in March.
Southwest shares fell 0.9% to 55.23 on the stock market today. LUV stock has been drifting downward below its 50-day line and toward its 200-day line after falling out of profit-taking range earlier this month.
American Airlines rose 0.4%, Delta dipped 0.5%, and United lost 0.3%. Boeing stock added 0.6%.
During Kelly’s tenure, he helped with the acquisition of AirTran Airways, launched Southwest’s first overseas routes and service to Hawaii, and navigated the airline through the Boeing (BA) 737 Max grounding.
Kelly said he was proud that the airline never had a single layoff or furlough, even amid the Covid-19 pandemic, according to the company’s news release.
The airline said future CEO Jordan led the efforts to establish voluntary leave and early separation programs which were “instrumental in avoiding layoffs and furlough actions” during the pandemic.
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