A holiday travel meltdown that left tens of thousands of its customers stranded at airports across the country will prove costly for Southwest Airlines, which said Friday it no longer expects to post a net profit for the final quarter of 2022.
Other costs include reimbursements to customers for expenses they incurred because of the cancellations, the company’s decision to give 25,000 bonus miles to affected travelers and additional pay to employees stemming from the disruptions.
The carrier said it canceled more than 16,700 flights between Dec. 21 and Dec. 31. The cancellations, initially driven by fierce winter storms, were compounded by an unprecedented internal breakdown of the company’s scheduling technology, which hobbled the carrier’s ability to recover, even as other airlines resumed service.
The breakdown, during one of the busiest travel periods of the year, has drawn scrutiny from lawmakers and regulators. Transportation Secretary Pete Buttigieg has said he is closely monitoring Southwest’s efforts to compensate customers.
On Thursday, Rep. Rick Larsen, (D-Wash.) and 25 members of the House Transportation and Infrastructure Committee sent a letter to Buttigieg urging him to “use the full weight of your agency to hold Southwest Airlines accountable, provide stronger consumer protections for passengers and help prevent these types of mass cancellations from occurring in the future.”
The day before, Sen. Maria Cantwell (D-Wash.), chair of the Commerce, Science and Transportation Committee, announced her committee will hold hearings to examine Southwest’s problems.
Southwest has tried to make amends, announcing this week it would give those affected by the breakdown 25,000 frequent flier miles, valued at more than $300. On Thursday, Southwest Chief Executive Bob Jordan said 75 percent of ticket refunds have been processed and 95 percent of bags have been returned or are on their way to customers.
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