Southwest Airlines has announced a reduction in its workforce to create a leaner and more agile organisation as part of its transformational plan.
The reduction is focused almost entirely on corporate overhead and leadership positions, with the reduction of around 1,750 employee roles, representing 15% of corporate positions.
In their announcement, Southwest Airlines said eleven leadership positions, including Vice President and above, will also be eliminated as part of the restructuring.
Southwest president and CEO, Bob Jordan said the separations will not begin until late April.
“Separations do not begin until late April. Until then, most Employees who are notified of their displacement will not work but will continue to receive their salary, benefits, and bonus, if eligible,” he said.
Jordan also said the changes will focus on maximising efficiencies and reducing costs, in the company's most comprehensive overhaul in its 53 history.
“We must ensure we fund the right work, reduce duplicative efforts, and have a lean organisational structure that drives clarity, pace, and urgency,” he said.
“This is a very difficult and monumental shift, and I arrived at this decision after careful and thorough reflection, knowing how hard it will be to say goodbye to Cohearts who have been a significant part of our Culture and our accomplishments.”
As a result of the reduction, it is estimated the company's partial-year 2025 savings will be around the US$210 million mark and full-year 2025 savings will be around $300 million. It expects a one-time charge between $60 million to $80 million for costs such as severance.
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