Southwest Airlines plans to further boost domestic and
international capacity throughout 2015, the carrier announced. Southwest also
reported that first-quarter 2015 net income almost tripled year over year to
$453 million.
By year-end, Southwest plans to increase available seat
miles 7 percent compared with 2014, much of that via added service from Dallas
Love Field. Southwest plans to operate by August 180 weekday departures to 50
nonstop destinations from the airport, a 50 percent increase since Wright
Amendment restrictions lifted in October 2014.
So far, demand for the additional service out of Love Field
has been strong, president and Southwest CEO Gary Kelly said Thursday during the
carrier's first-quarter earnings call. Many new flights added on April 8
already are running with load factors higher than 90 percent, according to
Southwest executives.
They likely are running close to Southwest's typical share
of 40 percent business and 60 percent leisure, though the shorter booking
window also could indicate a higher share of business travelers on the flight,
Kelly said.
Business travel demand has seemed stable, he said. Corporate
sales during the quarter were up by double-digit percentages and outpaced
capacity growth, Southwest chief financial officer Tammy Romo added.
The carrier also is expanding its international service—largely
to leisure destinations in Latin America, including service to Costa Rica,
added in March—and plans to add six international destinations from Houston
Hobby Airport upon completion of its international terminal in October.
Accelerated capacity growth beyond this year will be "modest,"
according to Kelly.
During the first quarter, passenger revenue increased 6.2
percent year over year to $4.2 billion as operating expenses declined 8
percent, including a 33 percent decrease in fuel and oil costs. Net income for
the quarter was a first-quarter record and only $34 million shy of an all-time
record, according to Romo.
Load factor increased 0.8 percentage points year over year to 80.1 percent, as a 7.1 percent increase in traffic outpaced a 6 percent rise in capacity. Southwest's average first-quarter fare increased 0.7 percent year over year to $158.01.