SWAPA Prepares For Southwest Merger

Southwest Airlines may have adopted a fresh approach to delivery delays for new aircraft: It's rumored to be considering adding to its fleet by buying another airline. So sure that the airline is in acquisition mode, the Southwest Airlines Pilots Association is now lining up lawyers to deal with the inevitable labor force fallout that such an acquisition would bring. “Last month, SWAPA made the decision to retain several law firms if Southwest attempts to acquire another carrier,” SWAPA President Casey Murray wrote in a letter to union members. “To be clear, neither I nor anyone at SWAPA have any knowledge of an acquisition or merger in Southwest Airlines’ future. In fact, I hope a merger and/or acquisition never comes to pass.” Southwest has so far not commented on the rumors.

Murray and his advisers say Southwest has hitched its future to Boeing's smallest 737, the MAX 7, but it will be years before it's certified because of regulatory and design issues. Southwest has ordered 307 MAX 7s, whose 147-seat capacity is in the sweet spot for the short and high-frequency flights that are the backbone of Southwest's business model. Murray said the larger MAX 8 is simply too big for the airline to operate profitably. As for potential merger targets, the betting seems to be on JetBlue, which operates mostly Airbuses of various sizes and some Embraer E-175s. The main advantage is that it has little schedule overlap and would instantly fill Southwest's gaps on the East Coast.