How Did Southwest Airlines Perform Operationally In September?
In the month of September 2016, the low cost carrier, Southwest Airlines, saw its capacity increase 6%. Including this month, so far in the year capacity is up as much as 5.9% for Southwest. Although this is higher than the legacy carriers who grew their capacity only marginally to deal with negative unit revenues, it is much lower than the likes of Alaska Air which grew its capacity by 10.7% in the year so far. Southwest’s passenger traffic increased by 6.6%, while the occupancy rate was up slightly to 84.2%. Overall, the company performed better in all the key metrics as compared to the previous month.
However, the carrier continues to expect its unit revenues to remain in the negative territory. The management said that it expects PRASM to be down 3.5%-4.5% in the third quarter, of which 0.5% would be attributable to the company’s July technology glitch episode.
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Have more questions about Southwest Airlines (NYSE:LUV)? See the links below:
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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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