Q&A with David Harvey, Southwest Business

Absolutely, Destius. It's great to be with you, so thankful for the opportunity to connect here. And what it truly was such a tremendous milestone. We just turned one. So in August of 2019, we had a big bold announcement actually with Amadeus arm in arm, where it's a new business unit focused on making it easier to do business with Southwest. One of the things our customers kept telling us was we need to get our content through Amadeus. So that was a top priority, and the teams really rallied, worked together, and we were able to accomplish that earlier this month. So it's a very exciting time for Southwest and Southwest Business.

We're going to deliver. And even since we've gone live, and it's just been a couple weeks, so a small sample set, we are absolutely already seeing an uplift in Southwest Business for existing accounts, and then we're already starting to see as well incremental new business for all the subscribers that are plugged into the Amadeus network. So it's early days, we know that numbers are reduced in this COVID world, but out of the gate we are very pleased.

Absolutely. I think if you put yourself in the shoes just for a moment of the travel manager at the company or the TMC, things like being able to easily manage your funds, things like duty of care, there's just some of the responsibilities they've always had that have been kind of underneath the covers, if you will, have just taken so much more importance. There actually was a recent GBTA survey, their monthly survey, and senior leaders at companies as well as other stakeholders that actually use the travel, they're making sure we understand their needs, we're delivering them both the technical platforms and the solutions in this rapidly changing time. So we basically are Southwest is establishing partnerships with the top 50 TMCs and starting there, but look to even extend beyond that to a broader set of agencies as we look out into the future.

Absolutely. It's been a great relationship, it's been a strategic relationship. You know, when Southwest selected Amadeus Altea five years ago, that was a big bold move. The reservation system is the central nervous system of an airline, you got to get that right. But that was a very successful implementation. We started with international, then we switched over all of our domestic business. And then if you just think about how closely integrated the Southwest and Amadeus teams have been the last few years, it's about like any other relationship, there's an intimacy level to it, there's an understanding. So as Southwest thinks about new products and services, when we think about how we're going to go to market, that's just going to benefit us going forward, that strategic relationship.

Let me reflect here just for a moment, then I'll talk about going forward. You know, if you kind of rewind the clock, I know it feels like eons ago, but late February we started seeing some of that softness. Things kind of held on that first week of March, and then March 9th is kind of a day, at least at Southwest, which will live in infamy. It was when revenues went negative. We didn't even know that was a possibility, and it happened, and it literally extended on through the end of April. It wasn't until early May where that finally flipped again and we were getting some net positive bookings and revenue. And then there was a little bit of bullishness where things started accelerating. Leisure, beaches and mountains here in the US are definitely leading the recovery. If folks can get confident with our Southwest Promise, our Southwest Promise is a multi-layered approach to the cleanliness and distancing of the entire customer journey, keeping middle seats open. We've put so many new protocols in place to keep both our employees and our passengers safe. There are some companies out there that are doing well with COVID, so we're seeing government travel, transportation and logistics, medical, healthcare, grocery type businesses. So those companies are starting to think about their travel policy for 2021, they're thinking about how much budget they're going to have available, and we're having some really good conversations. For the business sector, you need headquarters offices to open back up, you need some of these conferences, conventions, meeting type activity. I do think it's going to be event-based, and then you're going to see a lot of these businesses say to all of their road warriors, all their travelers, you are now safe to get back on the road, we encourage you to start generating that next level of demand or sales. So we really see a nice uptick the back half of next year. None of us were around for the 1918 Spanish flu, but what happened right after that in the US was the Roaring 20s. We fully expect the Roaring 20s to hit again here over the next 18 months.

Thank you, Destius. Really appreciate you. Thank you.