Southwest has long hinted at — and passengers have long hoped for — such a move. The airline, which recently became the first in North America to fly the 737 Max 8, linked its decision to this new and upgraded Boeing model.
“For us, it’s the perfect fit for Hawaii,” Chief Revenue Officer Andrew Watterson told Bloomberg. “The Max has got 14% better range and 14% better fuel burn” than the model it succeeded.
The discount carrier plans to kick off services to Hawaii within the next two years, initially from California.
Flights to Hawaii can be logistically challenging, but the 737 Max 8’s flying range of about 3,500 nautical miles is enough to comfortably cover most flights from the West Coast to Hawaii.
For Southwest, an advanced new reservation system is also making the flights there possible. It expects to lower fares to Hawaii, one of the most popular destinations for travel within the United States. Regulatory approvals are pending.
Southwest shares edged up 0.7% to 58.94 on the stock market today, eyeing a 59.67 entry off a first-stage, cup-with-handle base. Hawaiian Airlines (HA) dived as much as 6% on the news, before trimming losses to 2%. Boeing added 0.4% and is now extended 7% from a mid-September breakout from a second-stage flat base.
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Airline stocks are on the mend after getting pummeled over the course of the third quarter. Investors had cooled on the industry group amid intense pricing wars, higher fuel costs and the shock of a string of hurricanes.
However, Delta Air Lines (DAL) beat Q3 EPS and revenue estimates Wednesday, while signaling that it expects improvement in the key trans-Atlantic market in the months to come. Delta shares changed little Thursday, just 4% below a 55.85 buy point off a cup base.
American Airlines (AAL) and United Airlines (UAL) nudged 0.3% and 0.4% lower respectively, but both industry stalwarts on Tuesday forecast better-than-expected unit revenue and margins for Q3. American is forming a cup base with a 54.58 buy point.
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