Bond.az reports: Southwest Airlines CEO Bob Jordan said on Wednesday the carrier has seen no drop-off in demand after joining seven industry fare increases since February, making him increasingly confident the airline can offset higher fuel costs with stronger revenue.
Speaking at a Bernstein investor conference, Jordan said the fare increases were the most he could recall in his 38 years in the industry. But demand remained strong across leisure and business travel, geographies and the booking curve.
“With fares up though that much, there’s been no drop-off in demand at all,” Jordan said. His comments add to signs that U.S. carriers are retaining pricing power even as a jump in jet fuel prices threatens to pressure margins, helped by strong premium and business demand and reduced discount-carrier competition.
Jordan also signaled Southwest could go further in reshaping its product, saying the airline may add more cabin options, including “true first class,” and is likely over time to delve into long-haul international flying. “I want to give you fewer and fewer reasons to book another airline,” Jordan said, while adding Southwest would remain focused on its domestic schedule, nonstop flights, operations, hospitality and employees.
Southwest has already introduced assigned seating, extra-legroom seats and other product changes. Business revenue rose 25% in March from a year earlier, with that trend continuing in April and May. Enrollment in Southwest’s Rapid Rewards loyalty program rose 37% in the first quarter.
