Rakesh Gangwal, a director at Southwest Airlines and co-founder of InterGlobe Aviation, has made a significant investment in Southwest Airlines by purchasing 3.6 million shares, valued at over $100 million.According to filings with the Securities and Exchange Commission, Gangwal bought the shares between September 30 and October 1, at prices ranging from USD 29 to USD 30 per share. This move aligns Gangwal’s interests closely with those of Southwest’s shareholders, strengthening his role in influencing the airline’s strategic direction, say experts.Southwest Airlines, based in Dallas, Texas, is known for its low-cost carrier model and its extensive domestic flight network. The company has a long history of profitability and innovation in the airline industry.Gangwal’s decision to increase his stake in the company comes at a pivotal time as Southwest aims to drive long-term growth and enhance shareholder value, experts added.Last week, the company hosted an Investor Day in Dallas, where President and CEO Bob Jordan presented Southwest’s “Southwest. Even Better.” transformational plan.Jordan outlined the airline’s strategy to achieve a return on invested capital (ROIC) of at least 15 percent, well above its weighted average cost of capital (WACC). The plan is projected to drive approximately USD 4 billion in incremental EBIT contribution by 2027.The plan is built on four key pillars: optimising the business with tactical initiatives such as network improvements and evolving revenue management practices; monetising the customer value proposition through new products and services like premium seating and partnerships with international carriers; increasing operational efficiency through cost-saving measures and better aircraft utilisation; and optimising capital allocation, including a USD 2.5 billion share repurchase program, he said.Southwest also introduced new leadership with the recent appointments of Bob Fornaro, former CEO of AirTran and Spirit Airlines, and Rakesh Gangwal, who joined the board in July. These moves, along with other board changes, reflect the company’s commitment to bringing fresh perspectives and industry expertise to help execute its growth strategy.Jordan acknowledged the challenges ahead, stating, “We have a plan that is actionable, time-bound, data-driven, and supported by significant research. I am accountable for delivering on our plan and expected results, as is our team and our Board.” The company aims to provide regular updates on the progress of its initiatives in the coming months.
Published On Oct 4, 2024 at 08:00 PM IST
Join the community of 2M+ industry professionals
Subscribe to our newsletter to get latest insights & analysis.
Download .App
Get Realtime updates
Save your favourite articles
Scan to download App
To list you hotel to sell or lease for free please Click Here
