Southwest eyes moves after rivals' bankruptcies

Leading U.S. low-fares carrier Southwest Airlines Co. said on Friday it might expand its services if bankrupt rivals Delta Air Lines Inc. and Northwest Airlines Corp. scale back operations.

"If they do, we are always open to that. We will be as aggressive as ever," Pete McGlade, vice president for schedule and planning, told reporters at the World Low-Cost Airlines summit in Amsterdam.

McGlade pointed to Southwest's decision to capitalize on opportunities at Pittsburgh this year after US Airways cut its services.

Delta and Northwest, which both filed for Chapter 11 bankruptcy protection this week, have said they will focus on reducing flights and switching to smaller planes on some routes.

McGlade stopped short of criticising U.S. bankruptcy laws, which other airlines say allow some carriers to gain an unfair market advantage.

"Unfair or not, we have to compete with it and do as good a job as we possibly can," McGlade said.

He declined to say whether Southwest still expected to grow profits by 15 percent in 2006 despite soaring fuel prices, but said market conditions were challenging.

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Extensive purchasing of forward contracts that lock in pre-arranged jet fuel prices has helped some low-cost airlines to shrug off record-high oil prices. But crucial fuel hedges are set to weaken in 2006.

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Canada's WestJet Airlines Ltd., which flies in the United States, on Friday attacked U.S. bankruptcy laws, saying they allowed airlines like Delta and Northwest to hide behind legislation.

"It protects those carriers from normal market conditions. It is used as a strategy by those carriers to protect themselves from competition," WestJet Vice-President of Revenue Hugh Dunleavy told the World Low-Cost Airlines summit.

Delta warned on Thursday it may miss 3,500 retirees' pension payments, while Northwest hired a battery of lawyers and advisors as the carriers began a long march through bankruptcy.

The third- and fourth-largest U.S. airlines joined United Airlines and US Airways in Chapter 11 on Wednesday after losing an uphill struggle with soaring oil prices and low-cost rivals.