Southwest Airlines is using the extra cash it got with the passage of the Republican tax reform bill and giving it back to employees and their communities.
In a video posted to the company’s Facebook page Tuesday afternoon, CEO Gary Kelly said Southwest will give each of it’s roughly 55,000 employees a $1,000 bonus on Jan. 8.
“Southwest Airlines has long been an example in corporate America of a company that puts people first by taking care of our employees, our customers, our shareholders and our communities,” Kelly says in the video. “Today’s news is a wonderful example of that leadership and commitment.”
Other airlines, like American, are following suit with the $1,000 bonuses.
Airlines are among the companies for whom the tax reform will be a boon for business, according to Forbes, which says Southwest boasts the top cash flow yield.
Another $5 million will be earmarked for charitable donations.
“We’ll work with our partners to put this money to work where our employees work and live,” Kelly said.
In addition, part of the tax savings will be invested in the company’s fleet -- which Kelly says could add new routes to Southwest’s repertoire. It will work with Boeing to “modernize” its fleet of aircraft in 2018. From a Southwest press release on fleet orders:
The Company exercised 40 Boeing 737 MAX 8 options for 15 firm orders in 2019 and 25 firm orders in 2020, and deferred 23 Boeing 737 MAX 7 firm orders from 2019 through 2021 to 12 firm orders in 2023 and 11 firm orders in 2024.