Southwest Airlines faces uncertainty, but opts out of US airline loans

Southwest Airlines is experiencing some slightly positive movement in bookings in Aug-2020 and Sep-2020, but the company continues to refine its capacity estimates as the recovery in demand remains jagged and shows no signs of stabilising in the immediate future.

The airline and other US operators are accepting the reality that demand will remain depressed until a vaccine for COVID-19 is widely available. And although daily case counts in the country appear to be decreasing, the US remains in the throes of the pandemic.

As a result, many US airlines are working to finalise loans with the US government; however, Southwest has opted not to participate in the programme, which ultimately could give it advantages over its peers that are accepting the terms of those loans.