Southwest Airlines (NYSE: LUV) revealed today that it will reduce its workforce as part of a larger effort to streamline operations and transform into a more agile organization. The company plans to cut approximately 1,750 employee roles, primarily focusing on corporate overhead and leadership positions. This reduction will affect about 15% of corporate positions, including senior leadership and director roles.
As part of the restructuring, eleven senior leadership roles, including Vice Presidents and other executives, will also be eliminated. These roles make up 15% of the airline’s senior management committee. The company expects the separations to be largely completed by the end of Q2 2025.
Bob Jordan, President, CEO, and Vice Chairman of the Board of Directors, commented on the difficult decision, stating,
“This decision is unprecedented in our 53-year history, and change requires that we make difficult decisions. We are at a pivotal moment as we transform Southwest Airlines into a leaner, faster, and more agile organization.” He has expressed gratitude to all Southwest employees for their contributions to the airline’s legendary history and for those who will lead the company into the future.
Southwest Airlines (NYSE: LUV) anticipates significant savings from the restructuring, with a projected $210 million in partial-year savings for 2025 and $300 million in full-year savings for 2026. However, these savings exclude a one-time charge expected in the first quarter of 2025, ranging from $60 million to $80 million, primarily for severance payments and post-employment benefits. Southwest Airlines expects to treat these costs as a special item.
Southwest Airlines has pledged to update the public on further cost-saving measures as 2025 progresses.
