Southwest Airlines flight cancellations increase in early summer – .

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Southwest Airlines flight cancellations increase in early summer – .


Southwest Airlines (NYSE : LUV) has a flight cancellation problem.
As demand for air travel rebounded in 2021, the budget airline giant quickly increased flight volumes. However, he has struggled to manage his schedule reliably in recent weeks, due to a combination of staff shortages, an IT outage and bad weather. If Southwest fails to get its operations back on track quickly, the airline could squander the growth opportunities it has pursued over the past year.

Flight cancellations are on the rise

Last month, Southwest Airlines canceled 2,687 flights, an average of about 90 per day. More than 34,000 of its flights have been delayed. The carrier significantly underperformed its main competitors on both parameters.

The trouble started around the middle of the month. A problem with a weather data provider on June 14 resulted in the delay of more than 1,400 flights by Southwest. The next day, a separate computer failure forced him to cancel around 500 flights and delay more than 1,300 more. Flight cancellations continued at a high rate over the following days as Southwest struggled to reposition flights and crews following the disruptions.

Southwest Airlines has continued to cancel numerous flights over the past two weeks. The airline mainly blamed the bad weather. Leaders in the Southwest also noted that while the carrier still operates fewer flights than before the pandemic, its flights are spread across more routes and more cities. This added operational complexity, making it difficult to recover from weather events and other external challenges.

Image source: Southwest Airlines.

In contrast, the Southwest Pilots Union says management has scheduled far too many flights given the pilots’ current availability. Indeed, while the carrier’s schedule might be achievable under ideal circumstances, the wave of delays and cancellations in recent weeks suggests that management has not incorporated an adequate safety margin.

Trying to stop the bleeding

It’s no surprise that Southwest Airlines’ flight cancellation problem is getting worse rather than better. Last month, the airline said it expected capacity 7% below 2019 levels in June and 3% below 2019 levels in July, down from an 18% reduction in May. Capacity typically increases sequentially from May to July as well, so Southwest has increased its flight schedule by over 20% in a matter of weeks.

In an attempt to keep things from getting worse, Southwest Airlines has offered many of its employees – including flight attendants, ground staff, and cargo staff – double pay for overtime during shifts. first seven days of July.

Unfortunately, he was unable to come to an agreement with his pilots for a similar arrangement. This could limit the effectiveness of this bonus program, as the pilot supply is particularly limited at this time. More than 600 pilots in the Southwest have accepted early retirement offers at the height of the pandemic last year. Hundreds more remain on voluntary leave. Additionally, many pilots require remedial training to be allowed to fly again.

Image source: Southwest Airlines.

Southwest Airlines must resolve this issue quickly

So far, Southwest’s attempt to fix its reliability issues by spending money on it doesn’t seem to be working. The airline canceled 212 flights on Thursday – more than 5% of its schedule – and 194 on Friday, according to FlightAware. Another 40% of the carrier’s flights were delayed on Thursday and punctuality was not much better on Friday.

The recent spate of delays and (especially) cancellations is making customers worse off, forcing some to re-evaluate their loyalty to Southwest Airlines. For now, these are just anecdotes, but as the number of affected customers increases, the likelihood of significant damage to Southwest’s reputation increases as well.

Southwest Airlines recently braced for strong growth. It has added 18 cities to its roadmap since early 2020 and recently exercised 34 Boeing 737 MAX 7 options, more than doubling its scheduled 2022 aircraft deliveries. That could continue its staffing shortages, unless it quickly hires and trains additional employees. At the same time, if the carrier alienates a lot of customers in 2021, demand could be below its projections next year.

Customers usually don’t care why their flight was canceled. They worry about missing a meeting or disrupting their vacation plans. Southwest Airlines cannot find any excuse for its poor operational performance over the past few weeks. The airline just needs to fix their operation ASAP. Otherwise, the business could permanently damage its brand and long-term growth prospects.

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