Southwest pledges to 'do better' after flight delays, cancellations

Southwest is offering employees 'premium pay' to work on days off, ramping up hiring in its large cities to help combat operational challenges

Southwest Airlines is pledging to "do better" moving forward after acknowledging the airline's recent operational challenges amid an increase in travel demand.

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During the airlines's second quarter earnings call, CEO Gary Kelly cited a "combination of technology issues, followed by weaker weather challenges across our entire network", which led to "significant crew availability concerns" as well as series of flight delays or cancellations

However, Kelly emphasized that the staffing problems were mainly related to a lack of ground operations workers, such as baggage handlers, rather than pilots and flight attendants.

In addition, the airline noted it is operating 16 fewer flights compared to June 2019, meaning there are fewer ways to accommodate its customers impacted by delays or cancellations, resulting in longer operating days.

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Southwest operated 650 more daily round-trip flights in June than it did in March, a 25% increase, and the number of passengers and the bags they checked nearly doubled. 

"That is just a monumental increase and it was done in a short period of time," Southwest chief operating officer Mike Van de Ven said.

Passengers wearing personal protective face masks walk past the Southwest Airlines ticket counter Tuesday, June 16, 2020, at the Tampa International Airport in Tampa, Fla. Some major US airlines, including United, American Airlines, Delta Air Lines,

Meanwhile, the airline's on-time performance dropped to 62.4% in June and is currently at about 67% in July. In comparison, on-time performance in 2019 was 75.1% in June and 80.3% in July, respectively. 

"We need to and we will do better than that moving forward," Van de Van added.

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In order to alleviate the operational issues, Southwest is offering its employees "premium pay" to work on scheduled days off and is looking to ramp up hiring in several of its large cities. Looking ahead, Southwest expects conditions to improve around August and September when storms "disappear" and summer travel winds down. 

"That will give us more recovery options than we have today,'' Van de Van said. "I think we'll be better in August than we were in July. And hopefully, here by the end of the third quarter and the fourth quarter, we'll be back to where we wanted to be.''

"It's not obviously the customer service that we want to offer our customers,'' Kelly added. "But I think the worst, clearly the worst of it, is behind us in June.''

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Southwest isn't the only airline facing operational issues in the wake of increased travel. Competitor American Airlines, which canceled hundreds of flights in June due to staffing shortages, plans to hire more than 1,300 new pilots by the end of 2022 to help meet rising travel demand.

Ticker Security Last Change Change %
LUV SOUTHWEST AIRLINES CO. 49.12 +0.66 +1.36%
AAL AMERICAN AIRLINES GROUP, INC. 19.89 +0.51 +2.63%

Despite the operational challenges, Southwest reported net profit of $348 million in its latest quarter, compared to a loss of $915 million last year.