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SWAPA, Southwest Reach Tentative Agreement On 737-800

Vote By Union Board Was Unanimous In Favor Of The Contract Modification

The Southwest Airlines Pilots' Association (SWAPA) and Southwest Airlines reached a tentative agreement on Thursday won the addition of the 737-800 to the Southwest fleet. The company had publicly stated their intent to convert current Boeing 737-700 aircraft orders to the larger 737-800s, and adding a new airframe justified re-opening the pilots' contract. Both parties say the agreement codifies issues related to the new airframe such as pay and work rules, and continues a history of efforts and collaboration between Southwest Airlines and its pilots on collective goals.

"We share the Company's enthusiasm for the added revenue this aircraft can provide," said Capt. Carl Kuwitzky, SWAPA President. "This allows our pilots to take a leadership role in tying our pay to the Company's profitability and investing in our future."

The agreement, which was unanimously approved by the SWAPA Board, includes a single pay rate for the 737, profitability-based raise added to the hard 2-percent raise in 2011, a contract extension with an amendable date extended to September 2012, and a profitability-based raise in 2012.

SWAPA will hold a membership vote on this side letter to the contract. Voting will run from November 1, 2010 through December 1, 2010.

"SWAPA is pleased that our portion of the Company's acquisition of the 737-800 is complete, and we look forward to sharing in the success Southwest Airlines has projected for this aircraft," continued Kuwitzky. "Now we can focus our resources on the acquisition of AirTran Airways and the transition into one carrier."

"Two months ago, we initiated discussions with both our Flight Attendants and Pilots as part of our contractual requirements to operate the -800," said Mike Van de Ven, Southwest Airlines Executive Vice President and Chief Operating Officer. "Today, I want to congratulate both SWAPA and TWU 556, the Union that represents our Flight Attendants, for recognizing the potential longterm benefits associated with adding the -800 to our fleet. We are still evaluating the needs for training, scheduling, aircraft configuration, and other regulatory considerations, but this is an important step in the due diligence process."

If approved by a majority vote of the Pilots, their current contract will be extended by one year, becoming amendable August 31, 2012, and also include the potential for wage rate increases based on the Company's financial performance.

FMI: www.swapa.org, www.southwest.com

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