Southwest Airlines 2015 Annual Report Download - page 39

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of Goodwill could be recorded in the Company’s results of operations as a result of changes in
assumptions, estimates, or circumstances, some of which are beyond the Company’s control. Factors
which could result in an impairment, holding other assumptions constant, could include, but are not
limited to: (i) reduced passenger demand as a result of domestic or global economic conditions;
(ii) significantly higher prices for jet fuel; (iii) lower fares or passenger yields as a result of increased
competition or lower demand; (iv) a significant increase in future capital expenditure commitments;
and (v) significant disruptions to the Company’s operations as a result of both internal and external
events such as terrorist activities, actual or threatened war, labor actions by Employees, or further
industry regulation. The Company can provide no assurance that a significant impairment charge will
not occur in one or more future periods. Any such charges may materially negatively affect the
Company’s financial results. See Note 1 to the Consolidated Financial Statements for further
information.
Item 1B. Unresolved Staff Comments
None.
Item 2. Properties
Aircraft
Southwest operated a total of 704 Boeing 737 aircraft as of December 31, 2015, of which 95 and 28
were under operating and capital leases, respectively. The following table details information on the
704 aircraft as of December 31, 2015:
Type Seats
Average
Age
(Yrs)
Number of
Aircraft
Number
Owned (a)
Number
Leased
737-300 (b) 137 or 143 22 118 78 40
737-500 122 24 11 9 2
737-700 143 11 471 397 74
737-800 175 2 104 97 7
Totals 12 704 581 123
(a) As discussed further in Note 6 to the Consolidated Financial Statements, 181 of the Company’s aircraft were
pledged as collateral as of December 31, 2015, for secured borrowings and/or in the case that the Company
has obligations related to its fuel derivative instruments with counterparties that exceed certain thresholds.
(b) Of the total, 78 737-300 aircraft had 143 seats and 40 have 137 seats.
31