Southwest will pay $140 million fine over 2022 collapse: NPR

Southwest will pay $140 million fine over 2022 collapse: NPR

Pristine Floyd searches for a friend’s bag in the Southwest Airlines baggage hold area at Denver International Airport in December 2022.

Michael Ciaglo/Getty Images


Hide caption

Toggle caption

Michael Ciaglo/Getty Images


Pristine Floyd searches for a friend’s bag in the Southwest Airlines baggage hold area at Denver International Airport in December 2022.

Michael Ciaglo/Getty Images

WASHINGTON — Southwest Airlines is still paying the price for its 2022 holiday meltdown that stranded millions of travelers — and the tab is growing.

The U.S. Department of Transportation has ordered Southwest to pay a $140 million civil penalty, as part of a broader consent order following the airline’s operational failures a year ago.

This penalty is by far the largest penalty ever imposed by the Department of Transportation for consumer protection violations, according to a statement from the department.

A digital screen displays canceled flights in the Southwest Airlines baggage area at Los Angeles International Airport in December 2022.

Robin Beck/AFP via Getty Images


Hide caption

Toggle caption

Robin Beck/AFP via Getty Images


A digital screen displays canceled flights in the Southwest Airlines baggage area at Los Angeles International Airport in December 2022.

Robin Beck/AFP via Getty Images

“It’s not just about the Southwest,” Transportation Secretary Pete Buttigieg said in an interview with NPR. Morning edition on monday. “It’s about the whole industry, sending a signal that you shouldn’t cut corners – because if you let passengers down, we’ll hold you accountable.”

A major winter storm last December disrupted travel across the country, with airlines canceling thousands of flights. But while other airlines recovered relatively quickly, Southwest collapsed. The airline ultimately canceled 16,900 flights, stranding more than two million passengers.

In a statement, Southwest called the agreement a “consumer-friendly settlement.” The airline says it has taken steps since last year’s outage to improve its operational flexibility and customer service.

“We have spent the past year laser-focused on efforts to enhance the customer experience through significant investments and initiatives that accelerate operational agility,” Bob Jordan, Southwest Airlines president and CEO, said in a statement. “Our commitment to customers has been central to our success throughout our 52-year history and has helped us become one of the most admired and trusted airlines in the world.”

Under the agreement announced Monday, Dallas-based Southwest must create a $90 million compensation system for future passengers affected by significant delays and cancellations, which is part of a $140 million fine. The airline will also pay $35 million in cash to the US Treasury, spread over three years.

Southwest reported earnings of $193 million during the third quarter of 2023.

The civil penalty comes in addition to $600 million In refunds and refunds paid by Southwest to passengers who experienced disruptions. The Department of Transportation said that in total, the company will spend more than $750 million on the holiday crisis.

“We’re sending a message reminding airlines that there are very strong economic reasons to meet their requirements, as well as it being the right thing to do,” Buttigieg told NPR. “We gave them 140 million reasons to make sure this never happens again.”

Buttigieg said the US airline industry as a whole has improved its operational performance since last year. The Sunday after Thanksgiving saw 2.9 million passengers travel in a single day — the most ever — while less than 0.5% of flights were cancelled.

Flight cancellations fell significantly in the first nine months of 2023, according to data from the Department of Transport. But delays and mishandling of baggage still persist Consumer advocates say travelers remain deeply dissatisfied.

Complaints about US airlines rose sharply in the first half of the year, according to a report published last week.

“Basically, airlines are on a reputation recovery tour, because they know how bad things have been the last few years,” said Teresa Murray, a consumer advocate at the US Public Interest Research Group, which published the report.

Travelers filed more than 26,000 formal complaints against US airlines in the first five months of 2023 — more than double the number filed during the same period last year, according to the report, and on track to break the annual record set in 2022.

“Last year’s disaster devastated the holiday celebrations of millions of families, many of whom spent the Christmas holiday sleeping on the floors of airport terminals,” Murray said in a statement. “We hope this punishment sends a strong message to all airlines that they cannot play with people’s lives this way. Travelers are not just seat numbers. Christmas 2022 is a holiday that millions will never forget, despite all the mistakes.” the reasons.”

You may also like...

Leave a Reply

Your email address will not be published. Required fields are marked *