Southwest Airlines said on Thursday that it will lower its 2023 capacity plan and hire fewer staff members than expected due to delays in Boeing jet deliveries.
The domestic-focused US carrier now expects 70 aircraft deliveries instead of 90, after Boeing’s latest problem with the 737 MAX, Southwest said in a press release.
As a result, the company will trim one percent of its expected 2023 flight capacity.
Following the latest Boeing issue, Chief Executive Bob Jordan said the company would also scale back on hiring plans.
“The reflow of our capacity for the year and our hiring plans, that’s all because of the change in Boeing deliveries dropping from 90 to 70,” Jordan said on CNBC.
“What we told you before was that we were going to be pilot-constrained, not aircraft-constrained,” he said.
But the situation appears likely to flip after the summer, with the change in Boeing’s delivery schedule.
“So that’s gonna force us to rethink our hiring plans across the board,” he said.
Boeing on April 14 said MAX deliveries would be delayed after a problem with a supplier part.
It said on Wednesday that while near-term MAX deliveries would be pushed back, it still expects the same deliveries for all of 2023. Chief Executive Dave Calhoun apologized for the inconvenience to customers.
Southwest reported a loss of $159 million in the first quarter, citing a $325 million hit after the company canceled more than 16,700 flights over the holidays due to system breakdowns.
The airline, which has apologized for the debacle, said current demand trends remained strong and that its investments to upgrade its systems were on track.
Another MAX customer, American Airlines, also expressed frustration with Boeing on Thursday.
On a conference call about earnings, American’s chief executive, Robert Isom, said the company did not have to make “too many changes” due to the latest MAX issue.
Boeing has been a great partner, Isom said. But he added: “At the end of the day, we need them to be incredibly reliable. We need them to be better than what they’ve been.”
“We need them to get their act together,” Isom said.
Shares of Southwest fell 4.6 percent to $29.48 in late-morning trading, while American gained 1.3 percent to $12.90. — Agence France-Presse
