This year is shaping up to be much better than last, Southwest Airlines CEO Gary Kelly told shareholders on Wednesday, but historically high and fluctuating fuel prices still pose a threat to both short- and long-term recovery, not only for Southwest but for the entire airline industry. Kelly said he has no plans for significant increases in the airline's fleet after cutting back on growth last year, and he stood by his decision not to charge for checked bags. Revenue and booking trends look strong, he said, though fuel costs are up 18%, even as Southwest has cut its fuel usage by 6%. "It is imperative for us and the airline industry that we continue to focus on fuel efficiency," Kelly said.

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