Southwest keeping eye on airline market

DALLAS, Dec. 20 (UPI) -- The head of Southwest Airlines said his company has made no offers to buy another airline but wants to be ready when the time comes.

"At some point, I think we'll probably acquire somebody," Gary Kelly, Southwest chief executive, told Dallas Morning News business editors and reporters.

He said there's bound to be a scenario that "would work for us" and Southwest wants "to be prepared for that opportunity that presents itself."

Southwest's investment in bankrupt ATA Airlines in 2004 offers a good example of being ready, he said.

Kelly said he found the airline industry to be "very tenuous."

"I think the industry is very unprepared for a slowdown in the economy, especially given the high energy prices,"he said. "The industry is not well-hedged, and the balance sheets are in terrible shape. The cost structures, for the most part, are still very high, even after bankruptcy. So it'll be an interesting 2008."