Southwest Airlines blames new COVID-19 surge for fewer bookings, more cancellations

Southwest Airlines said Wednesday that the recent surge in coronavirus infections is resulting in fewer bookings and more flight cancellations.

In an update to investors, the company said it has experienced a “deceleration” in bookings and an increase in trip cancellations in August, which “are believed to be driven by the recent rise in COVID-19 cases associated with the Delta variant.”

The company said that its outlook for the third quarter has worsened by 3 to 4 percentage points from its previous outlook, assuming that “COVID-19 cases remain elevated in the near-term and current revenue trends in August continue into September.”

Southwest estimated that its operating revenue would be down 15 to 20 percent in August compared to the same month in 2019. This is up from its previous estimate of being down 12 to 17 percent.

The company also expects operating revenue to be down 15 to 20 percent in the third quarter of 2021.

Southwest said it was profitable in July, but believes “the recent negative effects of the pandemic on August and September revenue trends will make it difficult for the Company to be profitable in third quarter 2021.”

“The Company will continue to monitor demand and booking trends and adjust capacity, as needed,” the airline said.

Despite the new surge in cases, Southwest CEO Gary Kelly told employees that the company will not require staff to be vaccinated.

“Obviously, I am very concerned about the latest Delta variant, and the effect on the health and Safety of our Employees and our operation, but nothing has changed,” Kelly said.