{"id":3805,"date":"2019-02-20T07:36:50","date_gmt":"2019-02-20T13:36:50","guid":{"rendered":"http:\/\/planesintheair.com\/?p=3805"},"modified":"2019-02-20T07:36:56","modified_gmt":"2019-02-20T13:36:56","slug":"southwest-airlines-cuts-2019-growth-forecast","status":"publish","type":"post","link":"https:\/\/planesintheair.com\/?p=3805","title":{"rendered":"Southwest Airlines Cuts 2019 Growth Forecast"},"content":{"rendered":"\n

(Reuters)\n – Southwest Airlines Co cut its forecast for first-quarter revenue per \nseat mile on Wednesday, citing weak passenger demand and a $60 million \nhit to first-quarter sales from the longest partial U.S. government \nshutdown.<\/p>\n\n\n\n

The\n more than month-long hiatus in U.S. government decision-making \nprevented the country’s fourth-largest airline from launching its new \nroute to Hawaii and led to widespread delays at airports.<\/p>\n\n\n\n

Southwest\n had said previously that it expected a $10 million to $15 million \nimpact on revenue in the first three weeks of January.<\/p>\n\n\n\n

On\n Wednesday, it quadrupled that for the full quarter and cut its growth \nestimate for unit revenue to a range of 3 percent to 4 percent from an \nearlier range of 4 percent to 5 percent.<\/p>\n\n\n\n

Shares\n of the company, which has also been cancelling flights in recent days \ndue to a conflict with maintenance staff and weather issues, fell nearly\n 5 percent in early trading, with a Goldman Sachs “sell” recommendation \nfor investors adding to the pain.<\/p>\n\n\n\n

Though\n the company has now received permissions for test flights to Hawaii, \nGoldman Sachs analyst Catherine O’Brien argued the shutdown would result\n in a shortened selling window for the airline, forcing it to discount \nfares heavily.<\/p>\n\n\n\n

“Most\n of the company’s schedule is published eight months in advance and we \nwould have expected a three to six month selling window for its Hawaii \nflights,” O’Brien wrote in a note, downgrading the stock to “sell” from \n“neutral”.<\/p>\n\n\n\n

“We\n now expect initial flights to have a one to one and a half month \nselling window, putting more pressure on management to fill planes in a \nshorter time frame,” she added, cutting price target on the stock to $54\n from $66.<\/p>\n\n\n\n

Southwest shares were last down 4.1 percent at $55.30.<\/p>\n\n\n\n

The\n company said on Tuesday it would be investigating a doubling of the \nnumber of planes grounded with mechanical problems in recent days as it \ncontinues talks with its mechanics union on a new contract that have \nbeen ongoing since 2012.<\/p>\n\n\n\n

Flight\n cancellations by Southwest accounted for roughly 24 percent of the \nnearly 800 total flights canceled across the United States on Tuesday, \naccording to flight-tracking service FlightAware.com.<\/p>\n\n\n\n

About\n half of the cancellations were related to unscheduled maintenance \nissues but the airline said it had yet to calculate the impact of the \ngroundings on its results.<\/p>\n\n\n\n

(Reporting by Ankit Ajmera and Rama Venkat in Bengaluru; Editing by Anil D’Silva)<\/p>\n\n\n\n

\"\"<\/figure>\n","protected":false},"excerpt":{"rendered":"

Southwest Airlines Co cut its forecast for first-quarter revenue per seat mile on Wednesday, citing weak passenger demand and a $60 million hit to first-quarter sales from the longest partial U.S. government shutdown.<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[797,89,2203,1397,868,1103],"tags":[118,3475,430,3066,2493,2514,660,1324,2521,688,428,2510,3474,718,412,1288,1762,2522,3338,186,1921,3407],"class_list":["post-3805","post","type-post","status-publish","format-standard","hentry","category-airline-news","category-aviation-news","category-finance-news","category-stock-news","category-transportation-news","category-travel-news","tag-airlines","tag-cancellation","tag-contract","tag-cut","tag-demand","tag-financial","tag-flight","tag-forecast","tag-goldman","tag-government","tag-hawaii","tag-maintenance","tag-mechanics","tag-new","tag-news","tag-reuters","tag-route","tag-sachs","tag-shutdown","tag-southwest","tag-union","tag-weak"],"_links":{"self":[{"href":"https:\/\/planesintheair.com\/index.php?rest_route=\/wp\/v2\/posts\/3805","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/planesintheair.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/planesintheair.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/planesintheair.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/planesintheair.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=3805"}],"version-history":[{"count":2,"href":"https:\/\/planesintheair.com\/index.php?rest_route=\/wp\/v2\/posts\/3805\/revisions"}],"predecessor-version":[{"id":3808,"href":"https:\/\/planesintheair.com\/index.php?rest_route=\/wp\/v2\/posts\/3805\/revisions\/3808"}],"wp:attachment":[{"href":"https:\/\/planesintheair.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=3805"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/planesintheair.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=3805"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/planesintheair.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=3805"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}