After what Southwest Airlines called a “modest improvement” in bookings in August, the airline is cutting back on the flights it will offer this fall.
Southwest said in a filing Wednesday that its available seats will be down 40% in September, compared to a year ago. It had previously said its capacity would only be down 20% to 25% in the month. And the reduced capacity will continue into October, when available seats will be down 40% to 50%.
The airline said the reduced flight plans are being implemented because “passenger demand and booking trends remain inconsistent.”
The company said the modest improvement in revenue and the efforts to cut costs have allowed it to trim its cash burn rate in the third quarter. Therefore it disclosed Wednesday that it will not need an additional $2.8 billion in federal loans this fall for which it was eligible. It said it has $15.2 billion in cash on hand as of Tuesday.
Shares of Southwest rose 3% in early trading Wednesday on the news.