Gary C. Kelly
{{short description|American business executive (born 1955)}}
{{Infobox person
| name = Gary Kelly
| image = 20170113 Gary Kelly.jpg
| birth_name = Gary Clayton Kelly
| birth_date = {{birth date and age|1955|3|12}}
| birth_place = San Antonio, Texas, U.S.
| death_date =
| death_place =
| education = University of Texas, Austin (BBA)
| occupation = Business executive
| title = Chairman emeritus, Southwest Airlines
| term = 2024–present
}}
Gary Clayton Kelly (born March 12, 1955) is an American business executive. He is the former chairman and former chief executive officer of Southwest Airlines.
Education
Career
Prior to his work at Southwest, Kelly worked as an audit manager for Arthur Young & Co. and a controller for Sterling Software.{{cite web |date=June 5, 2007 |title=Biography: Gary C. Kelly |url=http://www.pbs.org/wttw/ceoexchange/episodes/ceo_gkelly.html |archive-url=https://web.archive.org/web/20060914004937/http://www.pbs.org/wttw/ceoexchange/episodes/ceo_gkelly.html |url-status=dead |archive-date=September 14, 2006 |work=CEO Exchange}}
Kelly first joined Southwest Airlines in 1986 as a controller. In 1989, Kelly was promoted to chief financial officer and vice president of finance.{{Cite web|url=https://www.dmagazine.com/publications/d-ceo/2007/december/southwest-airlines-ceo-gary-c-kelly-sets-the-carriers-new-course/|title=Southwest Airlines' CEO Gary C. Kelly Sets the Carrier's New Course|website=D Magazine|language=en|access-date=2019-10-03}} In 2001, he was promoted to Executive Vice President. Kelly spent 3 years in this role until he was promoted to become Southwest's fifth CEO and vice chairman in 2004{{Cite web|url=https://www.dmagazine.com/publications/d-ceo/2010/december/dallas-ceo-of-the-year-2010-gary-kelly-of-southwest-airlines/|title=CEO of the Year (Again!): Gary Kelly of Southwest Airlines|website=D Magazine|language=en|access-date=2019-10-03}} replacing James Parker who succeeded Herb Kelleher in 2001.
Kelly was named chairman of the board of directors of Southwest Airlines on May 21, 2008, replacing co-founder Herb Kelleher.{{Cite web|url=https://obamawhitehouse.archives.gov/node/26519|title=Gary Kelly|language=en|via=National Archives|work=whitehouse.gov|access-date=2019-10-03}} Gary Kelly also became president of Southwest Airlines the same year, replacing Colleen Barrett when her contract expired on July 15, 2008.{{cite news |last1=ATW Plus |title=Southwest, AirTran CEOs become chairmen |url=http://atwonline.com/news/southwest-airtran-ceos-become-chairmen |access-date=4 January 2019 |work=Air Transport World |date=21 May 2008}}
File:Bob Fornaro and Gary Kelly.jpg
As CEO, Kelly has guided the airline to become the largest carrier of domestic passengers in the United States.{{cite web|url=http://dallas.culturemap.com/news/society/07-12-14-aime-award-gary-kelly-southwest-airlines/#slide=0|title=Southwest Airlines racks up another award thanks to CEO Gary Kelly |work=Dallas Culturemap|date=July 12, 2014}}{{cite web|url=http://www.baltimoresun.com/business/bs-bz-southwest-bwi-20150220-story.html|title=Southwest CEO sees BWI as international gateway |work=The Baltimore Sun|date=February 20, 2015}} He has led the company through a number of transformative, large-scale initiatives including the revamp of the airline’s Rapid Rewards program,{{cite web|url=https://www.latimes.com/business/la-xpm-2011-feb-26-la-fi-rapid-rewards-20110226-story.html|title=Rapid Rewards revamp is just one of Southwest Airlines' big changes|work=Los Angeles Times|date=February 26, 2011}} the introduction of the Boeing 737–800{{cite web|url=http://www.spokesman.com/stories/2010/dec/16/southwest-to-buy-larger-jets/|title=Southwest to buy larger jets|work=The Spokesman-Review|date=December 16, 2010}} and 737 MAX{{cite web|url=https://finance.yahoo.com/news/southwest-receives-first-delivery-boeing-230600060.html|title=Southwest receives first delivery of Boeing 737 MAX|work=Yahoo! Finance|date=August 30, 2017}} aircraft to Southwest’s fleet, the acquisition of AirTran Airways,{{cite web|url=https://blog.seattlepi.com/flyinglessons/2010/09/27/southwest-airlines-acquires-airtran/|title=Southwest Airlines Acquires AirTran|work=Seattle Post-Intelligencer|date=September 27, 2010}} the launching of Southwest's first international service, an update to the airline’s branding,{{cite web|url=http://www.toledoblade.com/Retail/2014/09/08/Now-middle-aged-Southwest-Airlines-will-change-the-paint-job-on-it-airplanes.html|title=Now middle-aged, Southwest Airlines will change the paint job on it airplanes|work=The Blade|date=September 8, 2014}} the adoption of the Amadeus reservation system,{{cite web|url=http://www.star-telegram.com/news/business/aviation/sky-talk-blog/article149589949.html|title=Southwest Airlines turns on new reservations system|work=Fort Worth Star-Telegram|date=May 9, 2017}} and large expansion projects at the company’s corporate headquarters in Dallas.{{cite web|url=https://www.dallasnews.com/business/southwest-airlines/2018/04/03/southwest-airlines-unveils-latest-addition-fast-growing-love-field-campus|title=See Southwest Airlines' new $250 million addition to fast-growing Love Field campus |work=Dallas News|date=April 3, 2018}}
On January 10, 2017, Kelly announced changes to the company's executive leadership ranks with Thomas M. Nealon named as president and Michael G. Van de Ven named as the airline's chief operating officer. These changes were effective immediately. Kelly retained the title of chairman and chief executive officer.{{Cite news|url=https://www.swamedia.com/releases/release-b05b0c63b8d86e19f5bd35d6cb2323ad-southwest-airlines-announces-executive-promotions|title=Southwest Airlines Announces Executive Promotions|work=Southwest Airlines Newsroom|access-date=2018-05-02|language=en-US}}
After agreeing to take a salary cut to prevent employee furloughs, his base salary reduced to zero until the end of 2021.{{cite web |title=Southwest CEO says it can avoid layoffs through 2021 with employee pay cuts |url=https://www.cnbc.com/2020/10/05/southwest-ceo-says-it-can-avoid-layoffs-through-2021-with-employee-pay-cuts-.html |website=CNBC |date=5 October 2020 |access-date=9 November 2020}} After Congress passed additional Payroll Support Program (PSP) measures, the SWA BoD retroactively reinstated Gary Kelly's full salary.
On 23 June 2021, Kelly announced he would relinquish his role as CEO in February 2022, with Bob Jordan announced to take his place at that time. Kelly said he would remain as executive chairman of the board until at least 2026.{{cite news |last1=Arnold |first1=Kyle |last2=Halkias |first2=Maria |title=Southwest Airlines' Gary Kelly stepping down as CEO next year, exec Robert Jordan will take over |url=https://www.msn.com/en-us/money/companies/southwest-airlines-gary-kelly-stepping-down-as-ceo-next-year-exec-robert-jordan-will-take-over/ar-AALmyoX?ocid=BingNewsSearch |access-date=23 June 2021 |work=The Dallas Morning News |date=23 June 2021}}
On December 15, 2021, Kelly testified against mask mandates on airplanes at a Senate Committee on Commerce, Science, and Transportation hearing while sitting unmasked next to other unmasked senior airline executives opposed to mask mandates; two days later he tested positive for COVID-19.{{Cite news|last=Laris|first=Michael|date=2021-12-17|title=Southwest Airlines CEO Gary Kelly tests positive for coronavirus after Senate hearing|newspaper=The Washington Post|url=https://www.washingtonpost.com/transportation/2021/12/17/southwest-airlines-gary-kelly-covid/|access-date=2021-12-20}}
In late December 2022, the airline experienced a catastrophic holiday meltdown with severe delays and thousands of flight cancellations through the Christmas holiday.{{cite news |last=Shepardson |first=David |date=December 18, 2023 |title=Southwest Airlines agrees to $140 million penalty over 2022 holiday meltdown |url=https://www.reuters.com/business/aerospace-defense/southwest-airlines-agrees-140-million-penalty-over-2022-holiday-meltdown-2023-12-18/ |work=Reuters |access-date=January 5, 2024}}{{cite news |last1=Walker |first1=Mark |last2=Chokshi |first2=Niraj |date=December 18, 2023 |title=U.S. Fines Southwest Airlines $140 Million for Holiday Meltdown |url=https://www.nytimes.com/2023/12/18/business/southwest-airlines-fine.html |work=The New York Times |location=New York City |access-date=January 5, 2024}}{{cite news |last=Yousif |first=Nadine |date=December 18, 2023 |title=Southwest Airlines fined $140m for holiday meltdown |url=https://www.bbc.com/news/world-us-canada-67751069 |work=BBC |access-date=January 5, 2024}} The US Department of Transportation (USDOT) launched an investigation, and in December 2023, the airline reached a settlement and received a record-setting $140 million fine from the USDOT and reported losses exceeding $1.1 billion stemming from the crisis.{{Cite web |date=December 18, 2023 |title=Southwest Airlines reaches $140 million settlement for December 2022 flight-canceling meltdown |url=https://apnews.com/article/southwest-airlines-settlement-canceled-flights-4c2a6bc25b52019a5966f6d5ef702fc6 |access-date=December 18, 2023 |website=AP News |language=en}}{{Cite web |date=December 18, 2023 |title=Southwest fined $140 million over 2022 holiday flight disruptions |url=https://www.nbcnews.com/business/business-news/southwest-fined-140-million-2022-holiday-flight-disruptions-rcna130179 |access-date=December 18, 2023 |website=NBC News |language=en}} A major cause of the crisis was the inability of Southwest's crew scheduling system to cope with disruptions from a major winter storm affecting Chicago and Denver. The Southwest Airline Pilots Association, the union representing Southwest pilots, had warned publicly for months that the unreliability of the crew scheduling system would cause mass cancellations and that management was neglecting the problem.{{cite news |last=Arnold |first=Kyle |date=June 21, 2022 |title=Southwest Airlines pilots at Dallas Love Field: 'Our passengers and pilots deserve better' |url=https://www.dallasnews.com/business/airlines/2022/06/21/southwest-airlines-pilots-at-dallas-love-field-our-passengers-and-pilots-deserve-better/ |url-access=limited |work=The Dallas Morning News |location=Dallas, Texas |access-date=January 2, 2023}} The union blamed the crisis on Kelly's leadership, saying that he had fostered a corporate culture in which senior executives made decisions in isolation, and contrasting this with what it described as Southwest's history of "ground-up decision-making". Union president Tom Nekouei said, "This is not a Southwest Airlines problem. This is not an employees of Southwest Airlines problem. This is not an unprecedented weather problem. This is a Gary Kelly problem."{{cite web |last=Blanchet |first=Ben |url=https://www.huffpost.com/entry/southwest-pilots-union-ceo-gary-kelly_n_63b65df5e4b0ae9de1bb70a6 |title=Southwest Pilots Union Blames Former CEO For Holiday Meltdown |date=January 5, 2023 |publisher=HuffPost |website=huffpost.com |access-date=September 11, 2024 |quote=Southwest Airlines’ pilots union blamed the company’s holiday meltdown on former CEO Gary Kelly, who he said ruined Southwest’s culture of ground-up decision-making with “a headquarters-centric cult” of executives... “This is not a Southwest Airlines problem,” Nekouei declared. “This is not an employees of Southwest Airlines problem. This is not an unprecedented weather problem. This is a Gary Kelly problem.”}}
In June 2024, Elliott Investment Management, an activist investment fund, announced that it had taken a $1.9 billion position in Southwest and would seek to oust leadership at the carrier, arguing it had "failed to evolve" citing "leadership’s stubborn unwillingness to evolve the Company’s strategy."{{Cite web |date=2024-06-10 |title=An investment firm has taken a $1.9 billion stake in Southwest Airlines and wants to oust the CEO |url=https://apnews.com/article/southwest-airlines-elliott-management-investment-0fb6de334552718769677d77f03a64ee |access-date=2024-09-04 |website=AP News |language=en}} The purchase amounted to over 10% of common stock in Southwest, entitling Elliott to call a special meeting of shareholders if Southwest would not agree to its demands.{{Cite web |last=Maharishi |first=Meghna |date=2024-09-03 |title=Elliott Owns Enough Southwest Shares to Call for a Special Meeting |url=https://skift.com/2024/09/03/elliott-owns-enough-southwest-shares-to-call-special-meeting/ |access-date=2024-09-04 |website=Skift |language=en-US}}{{cite news |last1=Choksi |first1=Niraj |last2=Hirsch |first2=Lauren |url=https://www.nytimes.com/2024/09/10/business/southwest-airlines-board-elliott-management.html?unlocked_article_code=1.J04.452Q.IUNzqW-pSc17&smid=url-share |title=Southwest Airlines Agrees To Board Changes After Pressure From Elliott |date=September 10, 2024 |access-date=September 11, 2024}} Elliott demanded that Kelly and Jordan step down, blaming the pair for the sharp decrease in the value of Southwest stock over the preceding years.
On September 10, the day after the Southwest board of directors met with Elliott, Kelly said in a letter to shareholders that he would not seek reelection as executive chairman at the spring 2025 annual shareholder meeting.{{cite news |last=Skores |first=Alexandra |date=September 10, 2024 |title=Southwest Airlines caves to activist investor pressure, shakes up board |url=https://www.dallasnews.com/business/airlines/2024/09/10/southwest-airlines-caves-activist-investor-pressure-shakes-up-board/ |url-access=limited |access-date=September 10, 2024 |work=The Dallas Morning News |location=Dallas, Texas}} However, the airline announced in late October that Kelly would retire early on November 1, 2024 instead, and would assume the title of chairman emeritus.{{cite news |url=https://www.cbsnews.com/texas/news/southwest-airlines-executive-chairman-gary-kelly-retires-early-board-announces-new-members/ |last1=Gowdy |first1=ShaCamree |last2=White |first2=Dawn |title=Southwest Airlines Executive Chairman Gary Kelly retires early, Board announces new members |publisher=CBS News |date=October 27, 2024 |access-date=November 8, 2024}}{{efn|Chairman emeritus is typically a ceremonial title that allows the honoree to attend board meetings and act in an advisory capacity, but not to vote on official board matters.}} Southwest promoted aviation industry veteran Rakesh Gangwal, had been appointed to the board in July 2024, to chair of the board.{{Cite news |author= |date=November 4, 2024 |title=Southwest names aviation veteran Gangwal as board chairperson |url=https://www.reuters.com/business/aerospace-defense/southwest-names-aviation-veteran-gangwal-board-chairperson-2024-11-04/ |access-date=November 8, 2024 |work=Reuters}}{{Cite web |date=November 4, 2024|title=Southwest Airlines Names Rakesh Gangwal Chair Of The Board And Announces New Committee Chairs |url=https://newsroom.aviator.aero/southwest-airlines-names-rakesh-gangwal-chair-of-the-board-and-announces-new-committee-chairs/ |access-date=November 8, 2024 |website=AVIATOR |language=en}}
Awards and recognition
Kelly was named one of the best CEOs in America for 2008, 2009 and 2010 by Institutional Investor magazine and serves on the President's Council of Jobs and Competitiveness.{{cite web |url=https://obamawhitehouse.archives.gov/administration/advisory-boards/jobs-council/members/kelly |title=Gary Kelly |access-date=2014-12-20 |url-status=live |archive-url=https://web.archive.org/web/20170122004646/https://obamawhitehouse.archives.gov/administration/advisory-boards/jobs-council/members/kelly |via=National Archives |work=whitehouse.gov |archive-date=2017-01-22 }}
In 2014, Kelly received the Advertising Innovation and Marketing Excellence (AIME) Award.
Kelly was the 2016 recipient of the Tony Jannus Award for distinguished achievement in commercial air transportation.{{cite web|url=https://www.tampabay.com/news/business/airlines/southwest-airlines-ceo-gary-kelly-named-tonny-jannus-award-winner/2278295/|title=Southwest Airlines CEO Gary Kelly named Tony Jannus Award winner|work=Tampa Bay Times|date=May 20, 2016}}
In 2017, Fortune named Kelly the #3 most underrated CEO in America (after Satya Nadella and Jeff Bezos) based on a survey of Fortune 500 CEOs asking them which of their fellow CEOs do not get enough credit. Kelly received 85 votes.{{cite web|url=http://fortune.com/2017/02/16/most-underrated-overrated-ceos/|title=These Are the Most Over and Underrated CEOs|work=Fortune |date=February 16, 2017}}
On February 18, 2020, Gary Kelly was named as the recipient of the 2020 Philanthropic Leadership Award from The Ireland Funds.{{cite web |title=Southwest CEO Receives 2020 Philanthropic Leadership Award |url=https://www.focusdailynews.com/southwest-ceo-receives-2020-philanthropic-leadership-award/ |website=Focus Daily News |access-date=3 January 2023 |date=18 February 2020}}
On October 25, 2021, Gary Kelly was the recipient of the 2021 Lifetime Achievement Award from 3BL Media.{{Cite web|url=https://www.3blmedia.com/news/congratulations-3bl-medias-2021-responsible-ceo-year-honorees|title=Congratulations to 3BL Media's 2021 Responsible CEO of the Year Honorees!|date=2021-10-25|website=3BL Media|language=en-US|access-date=2020-10-26}}
Personal life
Kelly was born in San Antonio on March 12, 1955.{{cite web |date=April 19, 2010 |title=Southwest Airlines CEO is defining himself as a leader — without bag fees |url=https://www.dallasnews.com/business/2010/04/19/20100417-Southwest-Airlines-CEO-is-defining-himself-5278 |work=Dallas News}} Kelly received a Bachelor of Business Administration in Accounting from the University of Texas at Austin. He is a Certified Public Accountant.
Kelly first met his wife Carol in eighth grade. They married in 1976. Together, they have two daughters.
Notes
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References
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External links
- [http://www.swamedia.com/channels/Officer-Biographies/pages/gary_kelly Gary C. Kelly's executive profile] {{Webarchive|url=https://web.archive.org/web/20110817055646/http://www.swamedia.com/channels/Officer-Biographies/pages/gary_kelly |date=2011-08-17 }}
- [https://archive.today/20130122042525/http://www.dmagazine.com/Home/D_CEO/2010/December/Dallas_CEO_of_the_Year_2010_Gary_Kelly_of_Southwest_Airlines.aspx/gary_kelly CEO of the Year (Again!): Gary Kelly of Southwest Airlines]
- [http://www.blogsouthwest.com/gary_kelly Nuts About Southwest Blog]
- [https://www.youtube.com/watch?v=k5gPd-zvbiU/gary_kelly Gary C. Kelly Shares His Views on Leadership (Video)]
- [https://www.youtube.com/watch?v=ufzWFsSeQ5U/gary_kelly Gary C. Kelly on Becoming CEO of Southwest Airlines (Video)]
- [https://www.youtube.com/watch?v=VOkwtB5SLVY&feature=relmfu/gary_kelly Gary C. Kelly Describes A Story of Caring (Video)]
- [https://www.youtube.com/watch?v=TEhnx183xiY&feature=relmfu/gary_kelly Southwest Airlines Employee Testimonials (Video)]
{{Southwest Airlines}}
{{DEFAULTSORT:Kelly, Gary C.}}
Category:American airline chief executives
Category:McCombs School of Business alumni