The first Southwest moves came on Monday
A senior union official, Chris Click, added to speculation when, after an executive meeting where several important initiatives and issues were discussed, he said he "can't wait to share with everyone" on his fireside chat on Tuesday, February 18.
This story is being written late on Monday night (ET), so there may well be a big announcement from Southwest Airlines or the union tomorrow, but something more concrete and troubling for employees has emerged today.
On Monday, Southwest Airlines (Southwest) announced it was cutting 1,750 corporate and leadership positions, reducing that cohort by 15% by the end of the second quarter of 2025.
The airline was quick to point out that those cuts included 15% of the Company's senior management committee, with 11 senior leadership roles (Vice President and above) also being eliminated.
"I arrived at this decision thoughtfully and carefully, knowing how hard it will be to say goodbye to colleagues who have been a significant part of our Southwest Culture and accomplishments.
I'm grateful to all Southwest Employees who have shared in our legendary history and to those that will guide us into the next era of Southwest Airlines."
This is what Southwest expects to achieve by cutting 1,750 people
The impact of this decision will be felt quickly by those employees losing their jobs, with separations beginning in April. In terms of savings, which are the key driver for this action, Southwest said:
- The Company estimates the partial-year 2025 savings to be approximately $210 million and the full-year 2026 savings to be approximately $300 million.
- These savings do not include an expected one-time charge of $60 million to $80 million in the first quarter of 2025.
- That charge is related to severance payments and post-employment benefits, which Southwest expects to treat as a special item.
- One-time costs will vary based on specific Employee elections during the workforce reduction.
Transforming The Way We Work is Jordan's message
Separately, Jordan issued a Message to Employees on Monday, which seems to be directed more toward those who survive the cuts than those being pushed out the door.
His plan to transform Southwest is to boost customer revenues by giving customers what they want, maximizing efficiencies, minimizing costs, and making the most of the Company's investments.
He explained that Southwest must fund the right work, reduce duplicative efforts and have a lean organizational structure that drives clarity, pace and urgency.
He added that improving how people work together and get work done tremendously impacts the airline's efficiency and ability to deliver against these plans.
"Changing how we work is an essential part of becoming a more agile Company, and it will be a journey. We are building a leaner organization with increased clarity regarding what is most important, quicker decision making, and a focus on getting the right things done with urgency - not unlike our entrepreneurial founding spirit of the 1970s."
After a lengthy and acrimonious battle, activist investor Elliott Investment Management won five seats on the Southwest board in October last year, which was insufficient to take control.
The Elliot team had pushed for Jordan to lose his job, but without control of the board, it could not make that happen, and he held on to his role.
The 1,750 employees about to lose their jobs will have no such luck.
