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Southwest Airlines’ Gary Kelly stepping down as CEO next year

  • ASSOCIATED PRESS FILE
                                Southwest said today that Gary Kelly, 66, will transition to executive chairman and expects to stay in that role at least to 2026.

    ASSOCIATED PRESS FILE

    Southwest said today that Gary Kelly, 66, will transition to executive chairman and expects to stay in that role at least to 2026.

Gary Kelly will pass the baton to another longtime Southwest Airlines executive. Robert Jordan, next year.

Southwest said today that Kelly, 66, will transition to executive chairman and expects to stay in that role at least to 2026. Kelly has been CEO since 2004 and has been with Southwest for 35 years, joining as a controller.

Jordan, 60, executive vice president of corporate services, becomes CEO starting on Feb. 1.

“On behalf of the Southwest Airlines board of directors, I am delighted to announce Bob Jordan as CEO,” Kelly said. “Bob and I have worked side by side for more than 30 years. He is a gifted and experienced executive and well-prepared to take on this important role. Working closely with president Tom Nealon and chief operating officer Mike Van de Ven, we will begin developing transition plans in the coming weeks and months. These three top-notch Leaders make for a powerful team to lead us forward.”

Kelly has been at Southwest for 35 years, working his way up the company’s finance team and finally taking the position as the company’s fifth CEO in 2004. He’s led the company through major ups and downs including the 2008 financial crisis and most recently the COVID-19 pandemic, where Southwest responded by adding 19 new destinations and managing to come out in a stronger financial position than any of its competitors.

Kelly has also had to navigate the airline through trouble and controversy. The company suffered its first onboard passenger fatality in 2018, the grounding of its Boeing 737 Max fleet in 2019 and 2020 and threats to furlough workers unless they agreed to wage cuts, although the last issue was avoided through government payroll support.

“I think the thing I’m most proud of is that when Herb retired, we made this promise to him that we were going to take care of Southwest Airlines, and I feel like our people did that,” Kelly said in an interview with the Dallas Morning News last month.

During Kelly’s time as CEO, Southwest has nearly doubled the number of people it employs, from 33,000 to start 2004 to more than 62,000 before the COVID-19 pandemic. The carrier has since dropped about 6,000 workers through early retirement buyouts, but Kelly anticipates the company will start growing and hiring again soon. The company’s revenue has nearly quadrupled over that time to $22.4 billion in 2019 and Southwest for several years has carried more domestic passengers in the U.S. than any airline.

“The only thing he can really claim is massive success,” said Michael Boyd, an aviation consultant with Boyd Group International in Colorado. “It’s hard running that airline with how many unions are there, how many contract negotiations were there and how often you have to deal with Washington, D.C.

In 2014 under Kelly’s leadership, Southwest started its first international route to Nassau in the Bahamas and has since focused its growth on routes to leisure destinations in Central America, the Caribbean and Hawaii.

But some of Kelly’s most ambitious work has come during the last 16 months as Kelly tried to stave off financial disaster from the COVID-19 pandemic. Southwest, which usually runs a conservative route network flying to fewer destinations than its competitors, added 19 new airports to its route network. That expansion sometimes occurred in markets where Southwest already had a presence, like South Florida, Houston and Chicago, or in smaller destinations such as Eugene, Oregon and Bozeman, Montana.

With the move to executive chairman, Kelly follows the same path that Southwest’s iconic CEO Herb Kelleher did 20 years ago when he retired. Kelleher spent six years as executive chairman before giving up the chairman role to Kelly, Kelleher, who died in 2019, retired from the board permanently in 2008.

Jordan has been with the company nearly as long as Kelly, starting in 1988 and working in a variety of roles including chief commercial officer, director of revenue accounting, corporate controller and vice president of procurement. Jordan, who went to school at Texas A&M and earned a degree in computer science, started his career as a programmer and financial analyst at Hewlett-Packard.

Jordan said he is “humbled, honored” to become CEO.

“We have a terrific team of Leaders, many of whom I have had the joy of working alongside for decades. I’m looking forward to working with Gary, Mike and Tom on the transition effort and setting up Southwest for the next 50 years of giving Customers the Freedom to Fly.”

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