Presented by American Airlines In this week’s episode, Jay Shabat and Meghna Maharishi discuss Southwest's latest turnaround plan. They also look at the current state of the transatlantic market connecting the U.S. with Europe.  Key Takeaways Southwest Airlines' Strategic Changes: Southwest plans to implement premium seating, red-eye flights, and cut back services in some areas like Atlanta to improve profitability. The airline also plans to monetize aircraft delivery delays and expects a positive outcome despite pressure from activist investors like Elliott Management, which is advocating for leadership changes. Execution of the Plan is Crucial: While Southwest's strategy received a positive reception from investors, the main challenge lies in how effectively the airline can execute these changes within the expected timeframe, with some analysts expressing skepticism. Southwest’s Strong Historical Performance: Despite recent financial challenges, Southwest has had a solid historical track record, especially before the pandemic, when their profit margins were strong. In comparison, other budget carriers like Spirit and JetBlue have performed worse. Investor Pressure and Management Defense: Elliott Management, a significant shareholder, has been pressuring for leadership changes. However, there is debate on whether these proposed changes would truly benefit the airline since Southwest has already initiated several strategies that align with investor expectations. Transatlantic Market Overview: The transatlantic market, especially between the U.S. and Europe, has been performing strongly post-pandemic, largely driven by robust leisure demand. Despite some business travel decline, markets like Italy, Greece, and Portugal have seen significant capacity increases, reflecting changing travel patterns among American travelers. Connect with Skift Airline Weekly LinkedIn: https://www.linkedin.com/company/airline-weekly/ X: https://x.com/Airline_Weekly/ Facebook: https://www.facebook.com/airlineweekly/ Instagram: https://www.instagram.com/skiftnews/ WhatsApp: https://whatsapp.com/channel/0029VaAL375LikgIXmNPYQ0L/ Subscribe to @SkiftNews and never miss an update from the travel industry.