Tracking Southwest’s Capital Expenditure: How Has It Trended?

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LUV: Southwest Airlines logo
LUV
Southwest Airlines

Southwest’s capital expenditures includes payments made for buying aircraft, other flight equipment like spare engines, deposits related to future aircraft deliveries, and ground support equipment. Lately, the Dallas-based carrier has been increasing its capital expenditure, facilitated by low fuel prices and global economic recovery.

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The company plans to invest approximately $2 billion in property, plant, and equipment in 2016. Of this planned $2 billion, over 60% will be on re-fleeting or purchase of new aircraft. luv7

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Further, to make this expenditure more manageable the company has deferred the delivery of some of its aircraft to later years. The restructuring has led to 2 added aircraft, and the delivery has been spread over to an added year.

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Have more questions about Southwest Airlines (NYSE:LUV)? See the links below:

Notes:

1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com

2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for Southwest Airlines

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