Southwest looks at adding larger 737s to fleet

By Dow Jones Newswires
Posted Aug. 13, 2010 at 12:23 p.m.

Southwest Airlines Co. is considering including Boeing Co.’s 737-800 aircraft in its domestic fleet, with a decision expected before year’s end, as the discount carrier plans a push to win more business travelers and restore capacity slashed during the economic downturn.

The largest carrier of domestic U.S. passengers said the company still needs to discuss the plans with its labor units, as well as look at issues such as network flow and scheduling.
“While the aircraft could introduce additional complexities to our operation, we believe our existing network could be significantly enhanced by converting some of our future 737-700 deliveries to 737-800s,” said Chief Operating Officer Mike Van de Ven in a message to employees.

The 800s have more capacity than the 700s and would complement Southwest’s longer-haul flights and potentially provide cost savings, Van de Ven said. It also could help in airports where there is high demand and little, if any, ability to increase flight frequency.

Southwest and other low-cost carriers reeled in growth plans the last 18 months and continue to add limited capacity to balance supply with recovering demand.

Chief Financial Officer Laura Wright said last month that the company planned to keep the number of planes in its fleet unchanged  the next two years even as it accelerates plans to retire older planes and replace them with new 737-700s.

Southwest has credited part of its ability to keep costs down from flying just one plane model, the 737.

Shares of Southwest were down 6 cents, at $11.37, in early afternoon trading.

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