Southwest Mortgages 21 Planes
Posted on: Tuesday, 13 May 2008, 18:00 CDT
Southwest Airlines Co. has mortgaged 21 of its Boeing 737 jets, raising $600 million, the company said Tuesday.
The money was raised for general corporate purposes The Dallas Morning News reported.
We felt it was wise to bolster our cash positions, airline spokeswoman Beth Harbin said.
The loan, a combined effort of Citibank NA and seven European banks, needs to be repaid by May 2020, the report said.
Rising fuel costs have prompted a raft of reactions from airlines, including raising money through baggage fees, fuel surcharges and cutting back on schedules to ensure remaining flights are full.
Southwest posted earnings of $34 million in the first quarter of 2008, the only airline among the 10 largest in the United States to post a profit, the report said.
Source: United Press International
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