DALLAS - (Covering Katy News) - When Boeing grounded its 737 MAX aircraft, it created a stressful time for the employees of Southwest Airlines. Employees kept customers flying even without the availability of many of its planes. Now Southwest plans to guarantee that its employees see some of the money provided by a recent settlement with Boeing over the grounding.
Southwest may have been impacted by the grounding of the MAX more than any other airline because its fleet is made up of just one aircraft, the Boeing 737. Some of the 737's that Southwest flies are the MAX model.
The settlement has lowered Southwest's operating costs for 2019 and its board of directors is allowing that to be reflected in the company's employee profit sharing program.
"The company currently estimates this incremental profit sharing accrual to be approximately $125 million," said a Southwest Airlines press release.
"Our people have done an incredible job managing through the MAX groundings, while providing the highest levels of customer service and one of the best operational performances in our history," said Gary Kelly, Chairman of the Board and Chief Executive Officer. "We are grateful to our employees for their extraordinary efforts throughout the year and are pleased to share proceeds from our recent agreement with Boeing."
The company plans to provide 2019 profit sharing details early next year, including the percentage each eligible Southwest employee will receive.
"Southwest continues to engage in ongoing discussions with Boeing regarding compensation for damages related to the MAX groundings," the company said. "The details of these discussions and the settlement with Boeing are confidential."
The Boeing 737 MAX fleet has been grounded since the Federal Aviation Administration's order was issued on March 13, 2019. Southwest Airlines continues to monitor information from Boeing and the FAA on the impending 737 MAX software enhancements and training requirements.
"The airline remains confident that, once certified by the FAA, the enhancements will support a safe return of the 737 MAX aircraft," the company said.