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Southwest Airways reported a $68 million revenue for the ultimate three months of final yr because it struggled to shake itself of setbacks attributable to the Omicron variant of the coronavirus, which has delayed the journey restoration and is predicted to pull the airline to a loss within the first three months of this yr.
Now, with instances falling, “the worst seems to be behind us,” Bob Jordan, Southwest’s government vp, who will take over as chief government subsequent week, stated in a press release.
The corporate had reported quarterly income earlier final yr, however the fourth quarter of 2021 was the primary in two years wherein Southwest achieved a revenue with out the assist of presidency help. The airline obtained $2.7 billion in federal grants to assist pay staff in 2021, serving to to carry it to a full-year revenue of $977 million.
Regardless of the quarterly revenue, Omicron dealt Southwest and its friends a blow on the finish of final yr and into this one, as staff calling in sick at excessive charges, coupled with dangerous climate, compelled carriers to cancel tens of hundreds of flights over the Christmas and New Yr’s holidays.
Southwest was significantly onerous hit, canceling hundreds of flights, or about 9 p.c of scheduled journeys, within the two weeks beginning Dec. 25. Just one different U.S. service issued extra cancellations: SkyWest Airways, which operates regional flights for a number of different carriers.
The issues continued this month. Southwest stated it has canceled greater than 5,600 flights in January, taking a $50 million toll on working income for the month. Omicron additionally weighed on ticket gross sales and led to a rise in buyer cancellations. The airline now expects to report a loss for the primary three months of 2022.
“Regardless of our fourth-quarter revenue, we had a difficult begin to 2022 as we proceed to get well from the pandemic,” Mr. Jordan stated. He added that the airline had additionally pared flight plans for the primary half of the yr to “present further buffer to the operation.”
Nonetheless, Southwest expects working income within the first quarter of 2022 to be down solely about 10 to fifteen p.c from the identical interval in 2019. The airline additionally stated it hoped to revive most of its route community and return to typical productiveness ranges by the tip of subsequent yr.
Regardless of the challenges, Southwest employed about 5,000 folks final yr and expects to rent one other 8,000 this yr as journey continues to get well. To stay aggressive, the airline raised its minimal wage to $15 an hour on Aug. 1. It’s in discussions with its unions for an additional improve to $17.
Southwest was the one one of many nation’s largest airways to report a revenue for the ultimate quarter of final yr. Delta Air Traces misplaced greater than $400 million, United Airways misplaced almost $650 million and American Airways misplaced greater than $930 million. On Thursday, Alaska Airways stated it had eked out an $18 million revenue for the quarter, whereas JetBlue Airways reported a $129 million loss.
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Supply- nytimes