Southwest (Luv) The stocks fell 5% last week after the higher costs overshadowed progress in the reversal plans of the company.
A large part of the shares losses was the result of airline warning that the costs were accelerated in the first half of the year – echoing similar concerns that Jetblue set up (Jblu) Earlier in the week – with the expectation of earnings and margins to remain significantly below the top levels.
Despite some of the short-term challenges that plague the lower carriers’ costs, the executive director of southwest Bob Jordan remains optimistic about the recovery strategy of the company-the two has increased confidence in his Partner from the fleet, Boeing (Bajnica).
I spoke with Jordan after the results of the airline earnings earlier this week, and he told me to see “a lot of progress” with the manufacturer after a recent resolution of the company strike, although he admitted that production limitations could take “years” to be completely resolved.
Constant improvement in Boeing is crucial for Southwest job because the airline manages the fleet for everyone. In the last year, delays in delivery have forced the southwest to reduce the capacity, the displacement schedule and consume more on maintaining its existing fleet that has a “kosnjak” not only low-budget carrier, but also the industry as a whole, according to Avivia consultant Michael Boyd.
Looking in advance, the odds seem to improve. After walking earlier this month with factory floors of Planemaker, Jordan expressed his confidence in Boeing’s ability to increase 737 production. Jordan estimates that delivery will exceed its current goal of 38 aircraft this year, with the potential to reach up to 55.
This would indicate a significant step forward for Boeing, which has plagued a number of failures in the past year, including the fall after the door panel blows 737 Max Midflight and almost eight weeks of work on international work by international work by Machinists (IAM) Union (IAM) Union .
Bank of America analyst Ron Epstein repeated Jordanovo optimistic to take on Boeing in clients.
“The company has not shared its prospects of FY25 because it focuses on complete recovery from the influence and renewal of the Trust to stop the works. It is expected that production 737, which continued in 4q, will gradually increase, with delivery already on the rise,” he wrote, “he wrote,” he wrote, “he wrote,” he wrote, “he wrote,” he wrote Epstein.
At the invitation of the company, the Boeing CEO Kelly Ortberg told analysts that “things look encouraging so far” and said he sees a company that potentially exceeds its goal of production 38 737 a month and reaching a tempo from 42 a month to the end of the year to the end of the year.
“Everything is measured by the agreed key to our successful performance,” Ortberg said. “It’s an early production ramp and we have to remain disciplined in maintaining a stable manufacturing system.”
