What's happened
Southwest Airlines is undergoing significant changes amid pressure from activist investor Elliott Management. The airline announced a turnaround plan, including assigned seating and a revenue forecast increase, while Elliott seeks to oust CEO Bob Jordan and Chairman Gary Kelly, citing poor financial performance.
Why it matters
What the papers say
According to the NY Post, Elliott Management has criticized CEO Bob Jordan's leadership, stating, "He is not the right leader to execute on these 'transformative' changes." In contrast, Southwest defended Jordan, claiming Elliott has not pursued a constructive relationship with the airline. Business Insider UK highlighted that Southwest's new turnaround plan includes assigned seating and a revenue forecast increase, which helped boost its stock price by over 10%. The Independent noted that these changes could significantly alter Southwest's identity, moving away from its unique operational practices established over 50 years. This tension between Elliott's demands and Southwest's management strategy illustrates the conflicting perspectives on the airline's future direction.
How we got here
Elliott Management, owning over 10% of Southwest shares, has pressured the airline for leadership changes due to its declining stock performance since 2021. The airline's recent struggles have prompted a reevaluation of its long-standing operational practices.
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More on these topics
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Southwest Airlines Co. is a major American airline headquartered in Dallas, Texas, and is the world's largest low-cost carrier.
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Atlanta is the capital and most populous city of the U.S. state of Georgia. With an estimated 2019 population of 506,811, it is also the 37th most populous city in the United States.
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Delta Air Lines, Inc., typically referred to as Delta, is one of the major airlines of the United States and a legacy carrier. It is headquartered in Atlanta, Georgia.
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Paul Singer may refer to:
Paul Singer (public servant), Australian public servant, Official Secretary to the Governor-General of Australia
Paul Singer (politician) (1844–1911), German politician, co-leader of the SPD
Paul Singer (economist) (1932–201
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United Airlines, Inc. is a major American airline headquartered at Willis Tower in Chicago, Illinois. United operates a large domestic and international route network spanning cities large and small across the United States and all six continents.
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The Boeing Company is an American multinational corporation that designs, manufactures, and sells airplanes, rotorcraft, rockets, satellites, telecommunications equipment, and missiles worldwide.
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Gary Kelly may refer to:
Gary C. Kelly (born 1955), Chairman and former CEO of Southwest Airlines
Gary Kelly (footballer, born 1966), Irish football goalkeeper
Gary Kelly (footballer, born 1974), Irish footballer
Gary Kelly (bowls) (born 1989), Northern.
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Elliott Management Corporation is an American investment management firm. It is also one of the largest activist funds in the world.
It is the management affiliate of American hedge funds Elliott Associates L.P. and Elliott International Limited. The Elli