Southwest Airlines CEO Gary Kelly says it’s safe to fly — even as the budget air carrier confronts nearly 400 grounded planes, considers a second multibillion-dollar federal loan, and looks ahead to potential workforce cuts.
The airline is using electrostatic misters to disinfect aircraft, Kelly said Sunday on CBS’ “Face the Nation,” and booking limited numbers of passengers on the flights it does operate. The company joined other major air carriers in requiring employees and passengers to wear facial coverings in airports and on flights.
“It's as safe as an environment as you're going to find,” Kelly said.
But airlines face a dark outlook and gutted passenger demand as summer’s travel months approach. Southwest reported a net first quarter loss of $94 million last week, while warning investors the coronavirus pandemic is expected to hit second quarter performance “much more significantly” than the start of the year.
Despite agreeing to take approximately $3.3 billion in government assistance under the CARES Act, Kelly told Southwest employees the money doesn’t fully cover payroll costs through September and the airline should prepare to become “drastically smaller” if performance doesn’t “dramatically” improve from May through July.
“We've got a great business model and a low cost structure. But we're going to have to fight our way through this,” Kelly said Sunday. “And, obviously, I'm anxious to see how the travel demand develops here in the summer.”
The airline raised $6 billion last week, Kelly said, but the company still intends to apply for a roughly $2.8 billion government loan.
“So I think that we've got what we need to see our way through. But if we have to seek another government loan, we will do that,” Kelly said.
“The demand is just not there,” he said. “So obviously, if things don't improve, we have to downsize.”