Southwest to Cut 107 Jobs as O’Hare Service Ends June 4; Targets $4.00 EPS
Southwest Airlines will end service at Chicago O’Hare on June 4, laying off 107 employees while offering transfers across its network. The company faces margin pressure from oil price spikes, raised baggage fees, introduced extra-legroom options, and maintains a 2026 adjusted EPS target of $4.00.
1. Service End and Employee Layoffs
Southwest will cease operations at Chicago O’Hare International Airport on June 4, ending flights from that hub after more than four decades. The decision results in 107 frontline employees being laid off or relocated.
2. WARN Notice and Transfer Options
Southwest filed a Worker Adjustment and Retraining Notification under Illinois law to provide 60 days’ notice for the layoffs. Affected employees have the opportunity to bid for open positions at other airports, including the carrier’s Chicago Midway base.
3. Margin Pressure from Oil Prices
Recent crude oil price spikes driven by geopolitical tensions and U.S. policy shifts have strained Southwest’s unit margins. Fuel cost increases are outpacing hedging gains, putting pressure on profitability.
4. Fee Increases and EPS Guidance
To offset higher jet fuel expenses, Southwest raised checked baggage fees and introduced extra-legroom seating options. Management continues to target $4.00 adjusted earnings per share for fiscal 2026, dependent on fuel price normalization and competitive dynamics.