Why Southwest Is Melting

Why Southwest Is Melting

New York CNN —

A harsh winter storm that dumped several feet of snow across much of America resulted in widespread flight cancellations during the Christmas holiday. Air traffic was more or less back to normal on Monday — unless you booked your holiday travel with Southwest Airlines.

The Southwest accounted for about 87% of Tuesday’s U.S. flight cancellations, according to flight-tracking website FlightAware. Southwest has canceled more than 2,500 flights. The next highest: Spirit Airlines with 83.

Southwest warned it would continue to cancel flights until it could resume operations. The company’s CEO said it was the biggest disruption he had experienced in his career. The Biden administration is investigating.

What gives?

Southwest had a combination of bad luck and poor planning.

The storm hit Chicago and Denver hard, where Southwest has two of its largest hubs — Chicago Midway Airport and Denver International Airport.

Even more unlucky: The storm hit just as the so-called triple epidemic swept across America, sickening people and their families with Covid, the flu and RSV. Though Southwest says it was packed for the bank holiday weekend, an illness is making it harder to adjust to the increased system stress. Many airlines still don’t have enough staff to recover when events like inclement weather cause delays or flight crews exceed the hours they’re allowed under federal safety regulations.

But Southwest (LUV) also hurt itself with an aggressive schedule and underinvestment in its operations.

Southwest’s schedule includes shorter flights with shorter turnaround times, which is causing some of the problems, FlightAware spokeswoman Kathleen Bangs told CNN.

“Those processing times slow things down,” Bangs said.

Stranded customers have been unable to reach Southwest’s customer service lines to rebook flights or locate lost luggage.

Employees also said they were unable to communicate with the airline, the president of the union that represents Southwest’s flight attendants told CNN on Monday.

“The phone system that the company is using just doesn’t work,” Lyn Montgomery, president of TWU Local 556, told CNN’s Pamela Brown. “They just aren’t staffed with enough manpower to communicate flight schedule changes to flight attendants, and that has created a ripple effect causing chaos across the country.”

The problems Southwest is facing have been brewing for a long time, said Captain Casey Murray, the president of the Southwest Airlines Pilots Association.

“We’ve had these issues for 20 months,” he told CNN. “We’ve seen meltdowns like this a lot more often, and it really just has to do with outdated processes and outdated IT.”

He said the airline’s operations have not changed significantly since the 1990s.

“It’s phones, computers, processing power, programs that connect us to planes — that’s where the problem lies, and it’s systemic throughout the airline,” he said.

Southwest CEO Bob Jordan, in a message to employees obtained by CNN, acknowledged many of Murray’s concerns and promised that the company would invest in better systems.

“Part of what we suffer is a lack of tools,” Jordan told staff. “We have spoken a great deal about modernizing operations and the need to do so.”

He said the airline is “committed and investing in” improving its systems, but “we need to be able to produce solutions faster.”

The US Department of Transportation said it would investigate.

“USDOT is concerned about Southwest’s unacceptable rate of cancellations and delays, as well as reports of a lack of prompt customer service,” the agency said tweeted. “The Department will review whether cancellations were manageable and whether Southwest is adhering to its customer service plan.”

To recover, Jordan told The Wall Street Journal that the company plans to operate a little over a third of its schedule in the coming days to give crews a chance to get into the right positions.

If that all rings a bell, it’s because this isn’t the first time Southwest’s service has epicly melted together. In October 2021, Southwest canceled more than 2,000 flights in four days, costing the airline $75 million.

Southwest blamed this service collapse on a combination of bad weather in Florida, a brief problem with air traffic control in the area, and a lack of available personnel to prepare for those problems. It has admitted it was facing service problems caused by staff shortages even before thousands of canceled flights stranded hundreds of thousands of passengers.

Similar to this month’s service chaos, Southwest fared far worse than its peers last October. While Southwest canceled hundreds of flights in the days after the disruption peaked in October, competitors quickly returned to normal operations.

Later that month, during a phone call with Wall Street analysts, then-CEO Gary Kelly said the company was making adjustments to prevent a similar meltdown in the future.

“We have reined in our capacity plans to accommodate the current workforce environment and our on-time performance has improved accordingly,” Kelly said on Oct. 21, and we are currently more than halfway through that goal.”

And just like with the recent disruption, the Southwest Airlines Pilots Association claimed the cancellations were due to “management’s poor planning”.

– CNN’s Ross Levitt contributed to this report