Fitch downgrades Southwest Airlines outlook to negative

(Reuters) - Fitch Ratings on Thursday downgraded Southwest Airlines to a "negative" outlook from its earlier "stable" rating, citing the carrier's possible shift to a less conservative capital allocation and financial policy.

The credit rating agency adds that Southwest's lack of progress towards margin improvement and higher capital deployment may drive a negative rating action.

Last month, Southwest Airlines announced its plans to start charging some customers for checked bags, marking a departure from its passenger-friendly policies, which Fitch believes could risk eroding its competitive strength relative to its peers.

Fitch said it affirmed Southwest's long-term Issuer Default Rating, which is its outlook on the airlines' ability to meet its financial obligations, at "BBB+".

(Reporting by Aatreyee Dasgupta in Bengaluru; Editing by Alan Barona)

---

Serious News for Serious Traders! Try StreetInsider.com Premium Free!

---

You May Also Be Interested In

• Transport of dead bodies within Congo risks further Ebola spread, UN agency warns
• Indonesia central bank says it is monitoring banking liquidity
• "Lacks excitement": Netflix tumbles 9% as weak earnings forecast deepens doubts over growth