Southwest CEO on Yearly Outlook

" Well of -- airlines but they have not. And -- really conceding. That they will -- annually yearly -- yet but her smooth skies ahead for this company joining us now prop Fox Business president and you. The chairman and CEO of southwest -- Gary Kelly Garrett -- to see on Fox Business there. Great to be with you -- we're going to talk about the quarter bowling -- asking about I don't. First talk about the loss bid for the assets of Frontier Airlines that went through public. How is that going to end -- growth plans at southwest."

" Well you obviously we had a great opportunity due to grow in Denver very rapidly. By acquiring front here it was. It was a great opportunity for southwest but it was really fraught with a lot of complexity is so at the end of the day I was really happy with where that where we ended up there and obviously -- republic the best of luck we will continue to grow our presence in Denver. We're in the second position if you will in terms of the number of customers that we serve in the markets so I feel really good about where we are and I feel really good about our prospects ahead we. Just recently announced through three new nonstop destinations so look. We're we're having great success there."

" We'll certainly you're you're expanding your you're going to places like LaGuardia Boston and what I worked -- itself was years and years ago. You never the company never would have gone into a large market liked those because of delay issues because of cost issues why hadn't changed the strategy. Over the last couple years at the company and taking kind of a chance on his larger markets."

" Surely you know I don't know that it's so much change in strategy since you were here it's but the company is very different today we're the largest carrier in the United States number one. In terms of our seats offered on a daily basis in terms of the number of customers that we serve. And it just. Offers us the opportunity. To add cities to our route network in 2009. That just wasn't feasible to us forty years ago so. We have a very modest presence and New -- Borneo we we have eight around. Trip flights on a daily basis you compared to 3300. Departures on a daily basis so it's a very small component of our system. And we still love lead the nation. Most months and on time performance so we're able to manage it today words we really couldn't do that twenty years ago."

" Certainly in -- abolished jockey for those -- top spots let's talk about bookings. And what's happening right now the company announced a fare sale earlier this week for the winter months obviously this guy is some concern here. About travelled being don't have a -- to say that travels going to be down 14%. Are you seeing an uptick in bookings this -- into announced that fare sale."

" We had a record load factor beginning in July of all time record load factor so we have seen. Some improvement in demand compared to the first half of this year we had another record. August. And we haven't released -- September traffic yet but we're going to have another strong load factor here in the in the month of September so. We've actually got some momentum. -- especially the leisure segment of the market business traffic is still very very weak bookings are okay and in in many ways strong and will want to continue that momentum in and of course that's why we offered our fare sale I don't know. You know we're famous for low fares and will continue to use those for sales strategically going forward certain."

" Late well then we've got to talk about the third quarter and the full year is there any chance of many analysts are now famous out there. Is there any chance that southwest could be in the red for the border war for. The full year -- lost 37 million. And the first six months of this year."

" Well it's it's rich really. Too late or too -- there you look at it to talk about the third quarter Wall Street's got. Has projected to have a loss in the third quarter and so will will just have to. I give us a couple weeks and we'll get our report out but. For the year no I have mentioned a couple of weeks ago that we have not given up on being profitable for the year. Certainly our prospects are better today than what we thought sixty days ago it's still a very difficult environment. And fuel is the main wild card for us at this point. But at least our business is stabilized and we've seen some improvement all over again -- down compared to years."

" Okay if you're not on the -- a Wall Street going to be around other projections for Q3 than let's talk about oil hedge. Where are you -- not you still have oil sitting around seventy dollars that's going to impact your business as well as the slow travel season."

" Well we'd we'd do a lot better Boyle was at fifty there's no question about it seventies very high four. The recessionary environment that we find ourselves in with the revenues so we're heads in the fourth quarter. -- about that level seventy bucks roughly 3540%. And next year were hedged. Around 60% at 75 dollars a -- prices are below that. Will pay the market price but if they go over -- covered up very concerned about we're fuel prices are headed so well we've got to be heads in and we are appropriately so."

" All right let's talk about then about the workforce of about the flight schedules you have. Had to come out basically in trend back your flight schedules taken some aircraft. Out of the system. That is affected of course the employees of southwest. Are there going to be job cuts coming to your company."

" Well -- first of all. The main reason that we're doing as well as we are is because of our people our revenue performance is far better than our competitors. We haven't had one furlough we haven't grounded one aircraft to. And I'm just very very proud of the changes are people have made to produce these very very strong load factors that we're we're realizing today so all the credit goes to them. I I hope that we never -- ground airplanes or furlough employees and in fact. This is the most difficult year we've ever faced and every single employer itself was Caroline's gets a raise so it's. It's still very strong culture and we're we're so for through this recession avoiding any job losses we have. Trimmed our work schedule and our workforce. But that's all been voluntary so I hope that continues."

" Gary had to say -- thought of you because of course you've got a huge presence at midway airport in Chicago they've now been. Taken out of the running for the Olympics re disappointed when your president today. Yeah."

" Very disappointed you know Chicago is one of my favorite cities and one of our favorite. Service points on our system. We were deathly pulling for them I thought they were the best choice but. But that's windows I suppose and so I hope they. They can -- muster up -- bid for 20/20 that would be true."

" I haven't done are going to Gary Kelly chairman CEO of Southwest Airlines Gary thank you for talking exclusively to fox businesses --"