klfrodo Posted August 16 #1 Share Posted August 16 Collectively, there are some very smart people who monitor this board. I'm curious to hear the thoughts of some of you regarding the current situation in the C Suite of Southwest Airlines. Of course they have a board who guides executive decisions, but in the news, they are talking about some Elliott Investment Group who is demanding more seats at the table. Can someone break this down to the high school level so I can better understand what's going on? In the healthcare industry, I know that when investors come in and take over a hospital, it's almost like the old mob days where the business gets milked for everything it's worth, then run out of business. Link to comment Share on other sites More sharing options...
SelectSys Posted September 4 #2 Share Posted September 4 On 8/16/2024 at 10:33 AM, klfrodo said: but in the news, they are talking about some Elliott Investment Group who is demanding more seats at the table. Elliott has acquired enough voting shares now to force a special shareholders meeting from what the BBC article below says. If Elliott is successful convincing other shareholders to go their way, my gut suggests that Southwest will be a much changed airline that will lose a lot of the goodwill it has generated over its life. Already announced by Southwest is that seat assignments will cost money and the elimination of free checked bags is likely coming next. Soon, Southwest will be just like the big 3 airlines without the advantage of a significant international network or alliance partners or premium cabins/service. I guess the other possibility is that Elliott could drive them in the direction of an ULCC like Ryanair or Frontier/Spirit with completely unbundled services and rock bottom fares. However, I don't see how that works as Spirit and Frontier are have their own financial issues. In the end, Elliott will exit their position in the company stock and Southwest will be radically different company and most likely diminished in the eyes of their current fans/customers. Elliott really isn't a long term investor and they are only looking to drive a short term boost in the share price to make their gain. https://www.bbc.com/news/articles/ckgwpkvl97eo Link to comment Share on other sites More sharing options...
Rare FlyerTalker Posted September 4 #3 Share Posted September 4 Elliott's playbook: Let's find a company that has a unique position in a market that many see as commoditized. Rather than build on those market differentials, let's destroy years of product identification and make it an operational clone of its competitors. Tell Wall Street that it will take a while for the changes to bear financial fruit, so as to hold off the wolves for a bit. Watch how past loyal customers see that there's nothing special about Southwest anymore. Liquidate your holdings, so that others are left holding the bag as WN can't compete with DL and UA. Herb is rolling over in his grave right now. 5 Link to comment Share on other sites More sharing options...
6rugrats Posted September 5 #4 Share Posted September 5 Checked bag fees generate a tremendous amount of revenue. It seems as if the days of free bags on WN will not last forever. Link to comment Share on other sites More sharing options...
Rare FlyerTalker Posted September 6 #5 Share Posted September 6 In addition, bag fees are not subject to Federal tax, so they go direct to the bottom line. If the bag costs are bundled into the fare, the boys in DC get a piece of that. 1 Link to comment Share on other sites More sharing options...
fbgd Posted September 9 #6 Share Posted September 9 On 9/5/2024 at 9:25 AM, 6rugrats said: Checked bag fees generate a tremendous amount of revenue. It seems as if the days of free bags on WN will not last forever. The bags have never been free, they've just been baked into the fare. On 9/4/2024 at 7:33 AM, FlyerTalker said: Herb is rolling over in his grave right now. Where's the guy, Sargent Schultz, that used to post on here and run straight into every WN related thread and probably had more loyalty to WN than Herb himself? 1 Link to comment Share on other sites More sharing options...
zdcatc12 Posted September 14 #7 Share Posted September 14 On 9/9/2024 at 10:16 AM, fbgd said: Where's the guy, Sargent Schultz, that used to post on here and run straight into every WN related thread and probably had more loyalty to WN than Herb himself? Tim Dunn. Oh wait, that is Delta with him. Link to comment Share on other sites More sharing options...
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