Reported 9 months ago
Southwest Airlines, the third-largest passenger carrier in the U.S., faced a significant drop in its stock price of nearly 25% while its competitors like United Airlines and Delta Airlines saw their stock prices surge up to 30-50% during the post-pandemic revival. Despite growing revenue, its operating profit last year was only 20% of what it was in 2019. Southwest Airlines was criticized for sticking to an outdated business model, lacking modern IT systems, failing to adapt to changing customer preferences for added services, and experiencing major operational disruptions during a winter storm. Elliott Management, the largest shareholder, is pushing for board and executive changes, cost reductions, and revenue increases to help the airline recover from its downfall. The effectiveness of this strategy in instilling a much-needed growth mindset in the organization remains uncertain.
Source: YAHOO