Southwest Layoffs Will Take 15% of Its Work Force
Published On Feb 17, 2025, 6:54 PM
Southwest Airlines has announced its first major layoffs in 53 years, planning to cut 1,750 corporate jobs, which is 15% of its corporate workforce. This move is part of a broader strategy, driven by pressure from hedge fund Elliott Management, to streamline operations and improve profitability. The job cuts are expected to save the airline $210 million this year and $300 million next year, although severance costs could be up to $80 million. Despite past challenges, the airline continues to dominate other U.S. carriers in passenger numbers and customer satisfaction.
Stock Forecasts
LUV
Negative
The announcement of layoffs may lead to a short-term negative reaction from investors due to perceived instability, but the long-term savings and operational efficiencies could bolster the company's financials.
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