Southwest Airlines CEO Says Hawaii Demand ‘Very High’

Travel demand may increase for some ‘beach and nature inspired’ destinations even as airlines continue to rack up losses from coronaviruses.

In a call with investors Thursday, Southwest Airlines CEO Gary Kelly said “demand in Hawaii is actually quite strong.”

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The comments, however, came on the same day the major U.S. carrier reported its first annual loss since 1972.

“It was a big deal and with non-GAAP losses totaling $ 3.5 billion,” Kelly said,

However, the managing director said the airline remained “very well prepared” to weather this storm and was encouraged by the various decrees put in place in Aloha state as well as its pre-trip testing program. The program allows travelers to come to the islands without quarantine for two weeks provided they first produce a negative coronavirus test.

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“The pre-authorized program that they’ve put in place now that multiple carriers are operating, it really makes the experience pretty straightforward,” Kelly said. “And the demand for Hawaii is actually very, very strong. So we think there’s a huge amount of opportunity there.”

Kelly said the company is also seeing strength in Florida as well as throughout Texas, Colorado and Arizona.

However, California and Hawaii in particular “have started the fourth quarter with encouraging momentum,” he said, while warning that “the quarantine and stay-at-home orders will reverse some of the that “.

Overall, destinations inspired by beach and nature continue to outperform, he said.

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By comparison, some of the airline’s largest markets in the Northeast and Midwest, such as New York and Chicago, “are underperforming.”

Southwest will focus on managing capacity, inventory, pricing, costs and operations, Kelly said.

“These things that we control, we will manage and control them well,” he said.