Southwest Airlines’ Activist Investor Fight Is About to Intensify

The fight between Southwest Airlines and activist investor Elliott Investment Management is heating up.

Reuters reported on Sunday night that Elliott now holds enough of Southwest’s common stock (10% of all common shares) that it will be able to call a special meeting with Southwest. Elliott, one of the biggest activist investors in the U.S., wants Southwest CEO Robert Jordan and Executive Chairman Gary Kelly to be fired, wants to nominate 10 members to the 15-seat Southwest Board, and wants several other changes made to the airline.

The two sides are currently scheduled to meet next Monday, Sept. 9.

For travelers, more pressure on Southwest, which has seen its stock price cut in half since the pandemic, could mean more changes to an onboard experience that is already rapidly shifting.

The airline dropped maybe its most signature policy, open seating, in July and rumors are swirling that a change to its baggage policy could be next. It also announced plans for a premium ticket option with extra legroom and new redeye domestic flights within the U.S. that will launch on Valentine’s Day 2025.

In its latest letter published at the end of August, Elliott said that it is looking forward to meeting Southwest on Sept. 9 and continues to say that the changes Southwest has made are “too little, too late.”

“The reality is that today, Southwest needs fresh, proven executive leadership from outside of the Company to restore its once-industry-leading performance and return it to its rightful place atop the airline industry,” Elliott said.