Southwest to lay off 15% of corporate staff in cost-cutting effort
Published On Feb 18, 2025, 10:40 AM
Southwest Airlines plans to lay off 15% of its corporate workforce, which amounts to approximately 1,750 positions, primarily affecting corporate and senior leadership roles. The layoffs are part of a cost-cutting initiative to save an estimated $210 million in fiscal year 2025 and $300 million in 2026. The changes come after Elliott Investment Management, an activist investor, took a significant stake in the company and urged it to enhance its financial performance. Southwest is also focusing on improving operational efficiency and has plans to implement various changes aimed at optimizing its operations.
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The layoffs and restructuring are steps Southwest is taking to reduce costs and improve profitability. Although initially painful, these changes might strengthen the company's financial standing in the longer term, especially under pressure from activist investors. Investors may view this as a positive move toward financial health, but market volatility in the airline sector and uncertainty due to reduced workforce may still pose risks.
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