Skift Take
Gangwal’s appointment marks the end of a tense battle with activist investor Elliott, which had long been pushing for significant leadership changes at Southwest.
Southwest announced Monday that Rakesh Gangwal, a longtime airline executive and co-founder of Indian low-cost carrier IndiGo, would become independent board chair.
Gangwal’s appointment comes after Southwest struck a truce with activist investor Elliott Investment Management, which had been pushing for a major leadership overhaul. As part of the agreement, Southwest said it would appoint an independent board chair after chairman Gary Kelly said he would retire November 1.
Five of Elliott’s picks for directors are also joining Southwest’s board.
“Our critical priority as a newly constituted Board is to come together to work closely with Bob Jordan and the rest of the management team to return the carrier to superior financial performance,” Gangwal said in a statement.
Gangwal joined Southwest’s board in July, when the carrier was trying to fend off Elliott. He was previously the CEO of U.S. Airways and held executive roles at United Airlines and Air France. One of Elliott’s criticisms of Southwest had been that its board did not have enough external airline experience.
Last month, Southwest reported better-than-expected third quarter earnings as the industry cuts capacity from an oversupplied domestic market. The carrier also unveiled a plan to investors in September to boost its profitability. Part of that strategy includes premium and assigned seating, airline partnerships, red-eye flights and cutting capacity in underperforming markets.
In a call with analysts on October 24, Jordan said Southwest is currently working with regulators and vendors to certify its new premium cabin configurations. The carrier said during its Investor Day that it aims to operate such flights by 2026.
Bob Jordan is due to speak at the Skift Aviation Forum in Dallas, Texas on November 12. For more information and to get your ticket click here.
Airlines Sector Stock Index Performance Year-to-Date
What am I looking at? The performance of airline sector stocks within the ST200. The index includes companies publicly traded across global markets including network carriers, low-cost carriers, and other related companies.
The Skift Travel 200 (ST200) combines the financial performance of nearly 200 travel companies worth more than a trillion dollars into a single number. See more airlines sector financial performance.
Read the full methodology behind the Skift Travel 200.
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