Southwest seeks government aid to pay for added security costs

April 04, 2003|By BLOOMBERG NEWS

DALLAS - Southwest Airlines Co., whose insurance costs have risen sixfold since the Sept. 11 terrorist attacks, needs government aid to pay for added security, Chief Financial Officer Gary Kelly said yesterday.

"We've seen costs increase for security, and some rationalization of those costs makes sense, and that's what we're seeking," Kelly said in an interview with Bloomberg Television. "The government's support [for insurance aid] only extends through August of this year."

Despite "inconsistencies" in bookings for this month, Kelly said the airline expects to add 11 airplanes to its fleet this year. Southwest, the largest carrier at Baltimore-Washington International Airport, added 20 planes last year.

Lower oil prices and a shorter war with Iraq will help Southwest increase profit this year, Kelly said. Southwest is expected to earn 38 cents a share this year, according to analysts polled by Thomson Financial. It earned 30 cents last year.

"If we have a quick end to the war and travelers return, that would go a long way to achieving our goal," Kelly said.

Southwest shares lost 34 cents yesterday to close at $14.68 on the New York Stock Exchange.

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