Southwest’s CEO Bucks Skeptics With Hawaii Flights ‘Ready to Roll’
(Bloomberg) -- Southwest Airlines Co. is confident about prospects for its coming service to Hawaii, despite declining fares to the islands and a rival’s report of weak demand.
“Hawaii forecasts very well for us. We have, obviously, no thought of deviating from our plan,” Chief Executive Officer Gary Kelly said in an interview Thursday. The company is “very close” to gaining approval for extended flights above the Pacific from California and expects to begin service during the peak winter season, he said.
Kelly offered an optimistic view of the Hawaiian market even as heightened competition from the U.S. mainland has pushed down fares. Ticket prices will remain under pressure in 2019, according to Cowen & Co. analyst Helane Becker. Incumbent rival Hawaiian Holdings Inc. said last week that demand has fallen for travel among the islands -- a market Southwest also intends to serve.
“We’re going to ramp up pretty aggressively, but with a gradual increase in flight activity,” Kelly said at Bloomberg News headquarters in New York.
The Dallas-based airline said in July 2017 that it would begin flights to Hawaii. Once the Federal Aviation Administration gives the go-ahead, marketing could begin almost immediately and flights soon thereafter, he said Thursday.
“Weeks, not months,” Kelly said. “We’re ready to roll.”
Southwest expects to boost flight and seating capacity by no more than 5 percent next year, with half of that added traffic devoted to Hawaii. Kelly expressed confidence that the carrier’s low costs and high brand recognition will make the venture successful.
Nevertheless, “we still have to get in and play the game,” he said. “We’ll need to bring our best.”
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