Southwest pushes for upgrade on Boeing 737

Dallas: Southwest Airlines increased pressure on Boeing to upgrade its top-selling 737 model with more fuel-efficient engines, as Airbus SAS did with a competing plane, because waiting a decade for an all-new jet was too long.

"When you talk about something that's 10 years from now, that's not a solution, that's an idea," Southwest Chief Executive Officer Gary Kelly said in an interview in New York. "Who among us is to say it won't be 15 years from now? In the meantime, we're going to spend $40 billion on fuel."

Southwest is the biggest operator of the single-aisle 737, a competitor of the Airbus A320, which Boeing has said may not be replaced with an all-new model before 2020. While Airbus said that it would offer new engines on its narrow-body plane, Boeing has delayed a decision on the 737 until 2011 after initially planning an announcement this year.

Southwest's fleet of 544 aircraft, which Kelly plans to maintain by retiring older planes as new ones are added, consists solely of 737s. The CEO said that he's willing to wait "to a point" for Boeing to decide on offering a new engine before he looks at alternatives.

"I don't feel any issue today, that we have to have an answer today," he said. "In the meantime if there are real things that are alternatives, one is forced to look at that. We are very supportive of their efforts. There is no implied criticism here. At all."

Initial deliveries

Fuel accounted for 33 per cent of Southwest's total operating expenses in the first nine months of 2010, and a plane with about 15 per cent higher fuel efficiency would help cut costs.

The Dallas-based carrier will increase capacity 3 per cent to 5 per cent in 2011, excluding the fleet from its acquisition of AirTran Holdings, Kelly said in a speech yesterday in New York. Southwest said it has completed plans to convert 20 existing aircraft orders to Boeing 737-800s from 700s, with initial deliveries expected in 2012.

The more fuel-efficient and larger 800 will enable Southwest to carry more people on high-demand routes and allow flights to destinations such as Hawaii and Central America.

Chief Operating Officer Mike Van de Ven said in October that Southwest was "indifferent" on whether Boeing chose to offer an all-new successor to the 737 or a modified version with new engines.