Southwest agreed to sublease the smaller jets to Delta 2 months ago, and is only happy to spruce up the birds as they are delighted to be able to lease out the entire fleet.
“For us to make a deal with Delta, we agreed to pay those conversion costs,” Southwest chairman and CEO Gary Kelly said Thursday on Southwest’s Q2 earnings call.
Southwest “amazingly found a home for all 88 of those aircraft,” Kelly said. “You might think of it as a volume discount that we were willing to offer to induce our sublease customers to take those aircraft.”
“The value that we get from not flying the 717s and instead flying the 737s is substantial,” Kelly said. “So we’ll pay for that conversion cost in the first six months.”
Southwest will also redo the interiors of the 717s.