Southwest Airlines, the only big U.S. carrier that’s still profitable, may expand its fleet next year as competitors shrink operations to blunt surging fuel bills, chief executive Gary Kelly said.
The low-fare airline may keep as many as 10 older planes set to be retired this year and add 14 new jets in 2009, Kelly said. As United Airlines and others prepare to pare flying in the fourth quarter, Southwest has delayed finalizing what it will do next year, he said, without giving a time frame.
“We’re all curious to see what the effects of the cutbacks in the fourth quarter will be,” Kelly said. “We’re willing to grow the fleet, and that’s very different than what’s going on with most of our competitors.”
Southwest is benefiting from its strategy to lock in fuel prices in advance. About 70 percent of its fuel needs this year are hedged at prices equivalent to oil at $51 a barrel, less than half of today’s $133.84 closing price in New York.
After Denver-based Frontier filed for bankruptcy, Dallas- based Southwest said May 20 that it would increase service in Denver, Frontier’s home airport and a hub for United. Bloomberg News
