Monday, April 23, 2012

Southwest Airlines CEO Gary Kelly to Step Down in February

Company veteran Bob Jordan to succeed Kelly, who will become executive chairman

Gary Kelly, who has served as chief executive of Southwest Airlines Company for nearly 17 years, will step down in February, handing the reins to a company veteran as the carrier plots its path out of the coronavirus pandemic.

Bob Jordan, 60 years old, a longtime Southwest executive who is the airline’s executive vice president of corporate services, will take Mr. Kelly’s place as CEO, the company said. Mr. Kelly, 66, will become executive chairman and plans to serve in that role through at least 2026 at the discretion of the company’s board.

Unlike major rivals, Southwest has avoided bankruptcies and layoffs. But Covid-19 halted the airline’s 47-year streak of annual profits. Like competitors, Southwest took on billions of dollars of additional debt to survive—something Mr. Jordan will have to manage.

After a nearly $3.1 billion loss in 2020, Southwest was the first U.S. carrier to return to profitability in the first quarter of this year, due to an influx of government aid. It has embarked on an aggressive growth trajectory, with 18 new destinations announced since early 2020.

“Bob inherits a solid strategy and great momentum to continue the airline’s recovery as the COVID pandemic wanes,” William Cunningham, Southwest’s lead director, said in a statement.

Incoming CEO Mr. Jordan has been with the company since 1988. Across a range of roles, he oversaw the AirTran Holdings Inc. acquisition, the development of a new e-commerce platform for Southwest’s website and the company’s Rapid Rewards loyalty program, the airline said.

Mr. Jordan said he plans to continue pursuing Southwest’s growth course, with new cities in its network and new planes on order.

“A lot of this is about executing the plans that we already have in place,” Mr. Jordan said in an interview.

Two other Southwest executives—President Tom Nealon and Chief Operating Officer Mike Van de Ven —were also contenders, though the board was unanimous in its decision, Mr. Kelly said. Messrs. Van de Ven and Nealon plan to remain at the company, Mr. Kelly said.

“Where we together have the company is extremely well positioned for the current task at hand,” Mr. Kelly said. “We still are a low cost carrier with low fares and in an environment where it’s all about consumers and leisure travel.”

Southwest shares fell 0.6% in afternoon trading.

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