Southwest to Defer 737-800s!

700UW

Corn Field
Nov 11, 2003
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Southwest Airlines Co. will defer deliveries of 30 Boeing Co. 737 jets by about four years to cut capital spending in 2013 and 2014.

The deferrals will save more than $1 billion in capital expenditures, Chief Executive Officer Gary Kelly said today at
the Dallas-based carrier’s annual meeting. All the planes are Boeing 737-800 models, Southwest said.
 
Who knows how it will all come together but it may be related to the swap of the 717s which has been reported to include DL giving up some of its 737 delivery slots... thus WN might be deferring its own deliveries but picking up some of DL's. If the 717 deal is announced in the next couple weeks as continual rumors say it will be, then perhaps some of the pieces will fall into place.

However it all plays out with respect to aircraft, it does say WN is moving definitively to get itself back on solid financial footing.
 
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Probably because WT is making it a "everything is good for DL" subject. First, there's no real evidence that WN is interested in acquiring more 737-700's - they have already changed their orders to -800's. And today at the stockholders meeting they said that they're defering -800 deliveries from 2013/14 to 2016/17 IIRC. So why would they want DL's -700's.

I'm not discounting that in the not distant future WN wants to get rid of the 717's, or at least today that is the ultimate decision. DL doesn't have the number of 700's suggested to be swapped in the rumor (12 but only has 10), WN doesn't seem to be interested in -700's, and it's putting -800 deliveries off to keep the fleet static if not a little smaller for now. What WN said at the meeting was that they wanted to get WN back on solid financial footing before starting to expand again.

Jim
 
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Who said this has anything to do with 737-700s with respect to this thread?

Context IS that I said in a thread regarding the 737-700s that I believe DL would be willing to trade the 737-700s as part of a deal with WN that might involve the 717s and a gate swap in ATL if that is what it took to close the deal.
Nothing more.

Since WN has converted nearly all - if not all - of its remaining orders to -800s, the only reason they might be interested in DL's -700s is because they are high performance models that would specifically be capable of operating long-haul service to Latin America, obviously a key focus area for WN's growth.

Why I DID say above is that it is possible that WN might be deferring some of its own delivery slots - regardless of whether for 700s or 800s - in order to take over some of DL's delivery slots as part of the 717 deal.
If DL moves forward with the 717 deal, they would end up with about 200 narrowbody deliveries over the next five years or so, including the 100 737-900ERs DL already has on order and the 717s.

It is possible that WN has decided not to pursue the 717 deal and thus does not need near as many new deliveries as they have coming.... or they may still get rid of the 717s but do very little fleet replacement of their own native fleet.

Regardless, I made no attempt to connect the DL 737-700s with this announcement by WN, regardless if others read it that way.

Of the 4 posts on this forum to date, all 4, including mine, believe that WN is acting to improve its own financial performance - exactly what it said it would do.
How refreshing to think that 3 out of 4 people - and the 4th didn't even address the issue - can agree that a company might actually trust a company to be accurately speaking about its intentions.
 
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I assume that the 738s are more fuel efficient than the 733s on a trip basis (and obviously on a seat mile basis due to the many extra seats) but I also assume that the difference in fuel savings is much smaller than the delta between the MD-80 and the 738 (AA's situation). Thus, fuel savings aren't as big a driver at WN and the extra capacity of the 738s might help drive down fares (offsetting the benefits of the extra seats).
 
Basically right. If by 733 you mean the 737-300 there's probably a fair difference in trip cost due to the extra weight of the 738 but not as much as between the 738 and MD80.

Jim
 
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Or it could infer that WN has no confidence in the future market for growth.
B) xUT
given that WN's RASM growth has trailed the industry for a number of months, it says that they have a lot of work to do in order to price their product at levels the public will buy given current fuel levels and most recently WN has been paying a premium to the industry because of bad hedges.
IN the most recent month, WN's RASM growth moved to industry average which is the minimum it needs to be - WN used to regularly lead the industry in RASM growth.
WN has said they are in a no-growth situation for now, while they assimilate FL.
 
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Lets see WN got into the 737-800 game later than most airlines. WN has been Boeing's biggest US customer, they have launched several aircraft. Don't you think WN got to putting the pencil to what the 800 is doing and comparing it to what the 737MAX will do. After making the comparisons GK decided that if he was getting new aircraft why not go for the newest and most fuel efficient model. So why bring a few 800's on the property only to find out that the 737MAX is the better of the two. OR could GK have something else up his sleeve that he needs 1 billion for.
 
It's simple it makes business sense in the current environment,at least they didn't order 500 airplanes with no way to pay for it but BK...
 

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