Over the past several days, Transportation Secretary Pete Buttigieg has been talking about how Southwest Airlines will be held accountable for its operational meltdown. Even as the airline resets its operation as of today, there are still endless stranded travelers and lost bags. Buttigieg has now written a letter to Southwest Airlines CEO Bob Jordan, highlighting exactly what that accountability will look like.
In this post:
What Buttigieg requests from Southwest Airlines
On Thursday, December 29, 2022, the Department of Transportation (DOT) published the letter that was sent to Southwest Airlines’ CEO, highlighting what’s expected of the airline in the coming days and weeks. This is useful, as it gives consumers some reassurance as to what they’re entitled to.
The letter starts by correctly blaming Southwest for its operational issues since December 24. While weather was the initial problem, the mess since then has been within Southwest’s control. Buttigieg shares his four priorities for Southwest Airlines:
- Getting stranded passengers to their destinations safely and quickly
- Providing or reimbursing passengers for meals, hotels, and ground transportation to or from hotels
- Promptly refunding affected passengers for their cancelled tickets should the passenger not accept alternative offered such as rebooking
- Ensuring that passengers are quickly reunited with their baggage
The letter goes on to highlight expectations for each of these points, so let’s go over that.
Getting passengers to their destination
Here’s what the DOT expects from Southwest when it comes to getting passengers to their destination:
Southwest should ensure that every available resource is being used to assist stranded passengers in finding a way to reach their destination as quickly as possible. Southwest has stated that it will honor reasonable requests for reimbursement for alternate transportation, such as other airline tickets, Amtrak, or rental cars, for those impacted by a flight cancellation or significant flight delay between December 24, 2022, and January 2, 2023. It would be an unfair and deceptive practice not to fulfill this commitment to passengers. The Department will use the fullest extent of its investigative and enforcement powers to hold Southwest accountable if it fails to adhere to the promises made to reimburse passengers for costs incurred for alternate transportation.
Reimbursing for meals, hotels, and ground transportation
Here’s what the DOT expects from Southwest when it comes to providing meals, hotels, and ground transportation to and from hotels:
Southwest has committed to providing meals when a controllable cancellation or delay results in passengers waiting for 3 hours or more for a new flight. This includes all passengers traveling between December 24th and January 2nd who experienced a cancellation or significant delay. In addition, Southwest has promised to provide hotel accommodations and ground transportation to and from hotels for any passenger affected by a controllable overnight delay or cancellation. The Department will take action to hold Southwest accountable if it fails to fulfill commitments that the airline has made in its customer service plans for controllable delays and cancellations.
Refunding passengers
Here’s what the DOT expects from Southwest when it comes to refunding passengers:
Under the law, Southwest must provide prompt refunds when a carrier cancels a passenger’s flight or makes a significant change in the flight, regardless of the reason, unless the passenger accepts rebooking. This means Southwest must provide refunds within seven business days if a passenger paid by credit card, and within 20 days if a passenger paid by cash, check, or other means. The Department will use the full extent of its investigation and enforcement authority to ensure Southwest complies with its refund obligations.
Reuniting with baggage
Here’s what the DOT expects from Southwest when it comes to reuniting passengers with their baggage:
Southwest communicated to the Department that all baggage has been scanned and that there will be greater transparency for customers about where their bags are currently located, where they want them sent, and when they’ll receive them. We expect you to make every effort, including alternate shipping methods, to get baggage back to customers as quickly as possible. Also, under DOT’s regulation, Southwest is required to reimburse passengers up to $3,800 for provable direct or consequential damages resulting from the disappearance of, damage to, or delay in the delivery of a passenger’s baggage.
My take on the DOT’s letter to Southwest Airlines
While there’s nothing earth shattering in the DOT’s letter to Southwest Airlines, I think this is pretty valuable, and should put many travelers at ease. It creates very clear expectations of what Southwest Airlines needs to do, and also makes it clear that the DOT will hold the airline accountable (likely in the form of fines) if it doesn’t follow through on its customer service plans.
Southwest has offered to reimburse travelers for expenses incurred as a result of issues within the carrier’s control, but has been quite vague about that. With this letter from the DOT, the pressure is on for Southwest to deliver. Specifically, for flights between December 24, 2022, and January 2, 2023:
- Southwest will have to reimburse travelers who pay for alternative transportation; if your Southwest flight is canceled and you end up having to book on another airline, expect to be reimbursed, even if the ticket is really expensive (after all, fares are really high with how little inventory there is)
- Southwest will have to reimburse travelers for hotels, meals, and transportation to and from hotels
- Southwest needs to refund travelers within seven days for canceled flights
- Southwest not only needs to get bags back to people as quickly as possible, but also needs to reimburse them for any necessary expenses they’ve incurred as a result of delayed or lost bags
Southwest Airlines has a monumental task ahead of it here, so a couple of thoughts…
First of all, I can’t even imagine how much this whole situation will cost Southwest. The airline will have to refund passengers on canceled flights, and that could easily be a ten figure amount. Then the airline will also have to reimburse passengers for some (likely) very costly expenses. That doesn’t even begin to address the long term damage to Southwest’s reputation (though consumers do tend to forget).
Next, the airline has some serious time pressure here, and I feel bad for Southwest’s frontline employees working in customer service. I can’t imagine Southwest’s customer service department is equipped to handle hundreds of thousands of urgent customer requests in a very short time period.
So how exactly will the airline handle that? Will Southwest greatly increase its staffing in that department, or how will the airline ensure it can get to passenger requests in a timely manner, while the DOT watches? It’s really important that Southwest does this promptly, because many are paying out of pocket for travel expenses that they probably can’t afford.
I would expect that Southwest will be very generous when it comes to reimbursements, since dissatisfied customers can file complaints with the DOT, and that could lead to costly fines for Southwest.
Bottom line
Transportation Secretary Pete Buttigieg has written a letter to Southwest Airlines CEO Bob Jordan, clearly outlining what he expects of the airline when it comes to customer service recovery efforts. This creates a pretty good framework for what customers should expect, including reimbursements for passengers impacted by operational issues.
What do you make of this letter to Southwest’s CEO?
As of this date no funds have been given for out of pocket expenses, nor updates from Southwest.
I was one of those stranded in Dec 24, I still Not have been reimbursed by Southwest.
SWA flight 3245 from FLL to AUS was delayed from 6:55pm to 9:31 pm, just short of qualifying for any expense reimbursement, The plane originated in AUS and sat on the ground there since 1:50pm, but was still delayed 3 hours. SWA said traffic control caused the delay. Could this be true ?
Although SW noted an IT issue, I have some doubts if this and the scheduling are the primary causation issues. SW has been an airline that has reaped many rewards in the past 20th years and although needed upgrades are needed, I would expect they in fact have the capability to resolve these issues with minimal pain. Good one for the DOT. And fyi, I have always used SW as a preferred carrier.
This is such gross mismanagement. Southwest wasted many people's time and greatly negatively impacted their lives simply because of corporate greed. The customers can never be made truly whole for the abuse they endured. The Federal Government should immediately become the largest shareholder of Southwest, shut it down and give the routes and employees to more component carriers.
You all are insane first due to weather 90% of southwest airlines aircraft were stuck ice or snow that also stranded Pilots and Flight attendants.this is a weather related issue ONLY.i have worked baggage and the baggage department was bombed.were was the red cross or salvation army to assist with meals of some nature.how about the people stranded on the road where was the civil defense,red cross, salvation army to assist them...lighten up!!!
I was one of those passengers not getting there flight on Christmas eve. Then they rebooted me the next morning on Christmas day but it too was canceled. It took 4 days and over 160 phone calls but I finally got ahold of someone. They were polite I couldn't reschedule within 2 weeks so I am getting reimbursed. So I rescheduled my flight for May. I love Southwest airlines so hope everything gets worked out soon.
It should be standard regulation that if you find an alternate arrangement to your destination for a cancelled flight by other standard means (public airline, car rental or train/bus) then that should be fully reimbursed. We can have reasonable carve outs for someone getting a private or lieflat seat if they booked economy, or someone ubering 2 hours etc, but otherwise this is a very common sense regulation
Being a honest hardworking passenger all of this isn't going to help southwest return my baggage or my refund to me before I return home on Jan 2 2023 it's been 6days and I have not had any reply from southwest on my claim...it's very disappointing...I'm not going to retrace the he'll I went through trying to get from reno nev to el paso tx...on Christmas day .5 canceled flights 2nights sleeping in 3 different...
Being a honest hardworking passenger all of this isn't going to help southwest return my baggage or my refund to me before I return home on Jan 2 2023 it's been 6days and I have not had any reply from southwest on my claim...it's very disappointing...I'm not going to retrace the he'll I went through trying to get from reno nev to el paso tx...on Christmas day .5 canceled flights 2nights sleeping in 3 different airports and a 12hr train ride and still no luggage
I booked two other airlines with no refund in sight
So as I do appreciate the words of compliance...it means nothing to us passenengers still going through southwest airlines lies and no resources or honest answers or accountability for their actions....and no refund or my luggage being returned to me insight .....I return home to reno nevada on Jan 2 and will be out of pocket 1,000 dollars ....so please just think about us normal passengers still going through southwest he'll
Thank you
Gina Aurich
It is a common approach these days for large companies to put stock price ahead of sensible maintenance of employees and infrastructure. Railroads are doing the same thing. It's as if they don't believe their company can sustain.
What do they know that we don't?
You realize US airlines collectlive have never had a profit over their entire existance. All major carriers except Southwest has gone through bankruptcy. This is a high capital intensive business with single digit profit margins in the best of times.
The profits are being shifted by Big finance to e.g. air plane leasing companies in tax paradises. That way you safe both on taxes, and on distributing the earnings to employees.
"You realize US airlines collectlive have never had a profit over their entire existance."
You do realize that that has nothing to do with the situation at hand, do you not?
Southwest is not "US airlines (as a collective)" and one can count on a single hand the number of years where they didn't return a profit.
Yet, especially in the last ten-ish years, what'd they do with it: massively update their IT capabilities,...
"You realize US airlines collectlive have never had a profit over their entire existance."
You do realize that that has nothing to do with the situation at hand, do you not?
Southwest is not "US airlines (as a collective)" and one can count on a single hand the number of years where they didn't return a profit.
Yet, especially in the last ten-ish years, what'd they do with it: massively update their IT capabilities, even post joining Sabre?
No. They instead chose to engage in (legal, but questionably ethical) bullshit like manipulating their stock through $5billion in buy-backs, and suppressing union (most notably TWI Local 556's) objections to the airline's utterly incapable IT structure... which has now so publicly come back to bite them in the ass.
Proof you get what you pay for
Well it's not quite EU261 but it's a start. The responsibility for meals/accommodation should really be there regardless of the reason for delay.
Southwest has no legal obligation to do anything beyond their Contract of carriage. Congress has repeatedly refused to write any laws with teeth. In fact, I would not be surprised to see Congress gift the airlines another $20 billion of taxpayer cash to "build back better" and completely ignore the previous $54 billion gift from you and I.
WN shouldn’t be allowed to expand in any way until they have a robust new IT product in place. Even if that takes years, it just makes sense to prohibit the airline facing an even larger operation before it can manage even a small operation.
EU261 style regulation is definitely needed, including the expanded duty of care that extends to meals and hotels for legitimate weather delays, along with the automatic compensation for controllable events.
I wish EU261 did include automatic compensation. Unfortunately its always a hassle to get it as airlines are dragging their feet.
The sums should also automatically be adjusted for inflation. 250/400/600 EURO in 2004 when the regulation first became effective were much more valuable than they're in 2023.
Why should airlines cover for weather delays? Does Uber or Amtrak pay for delays during winter storms or hurricanes?
It never ceases to amaze me the amount of Americans that argue against their own benefit.
There are no free lunches. If you raise the cost for airlines, it has to be paid by someone and that person is the traveler. I can see putting in protections against airline negligence, but why should airlines pay when the FAA orders a ground stop or gate holds due to volume.
It is absolutely not true that an increased cost *must* result in an offsetting price increase to the consumer. Other possible firm responses include a reduction in profit or an offsetting cost savings in some other part of the operation. This is elementary stuff.
Airlines profit margins are in the high single digits in the best of times. Over the last 5 years or 23, airlines have collectively incurred losses and have had no net profits. So you want airlines to trim costs in areas such as IT that you are complaining about or delaying buying new airframes that also affect relaiability. Please be specific where there is fat you would like to cut.
or indeed lower "exceptional costs" - i.e. things which are going to happen every so often but management pretends they are not, which actually lead to higher profits!
I'm sure we have all seen management reject proposed investments which would *save* money in the medium-term, let along long-term.
Amtrak does cover delays and actually operates in much worse conditions than the airlines. Uber isn't a comparison, given the distances involved.
The airlines have much more flexibility to recover than a fixed route train does, even in inclement weather. That said, much of the severity of impact comes from operational planning and not the weather itself, which is the entire point here.
I didn't know Bob Jordan used Brian Gasser as an alias
At that point, the US should just copy the EU261/04 regulation. The DOT expectations are basically exactly that anyway.
The United States needs EU261 style regulations. Once implemented airlines will miraculously have many fewer delays and cancellations. Airlines in Europe screamed and said fares would rise but fares have actually decreased.
Bingo. The airlines are always going to prioritize shareholders over customers without an external force holding their feet to the fire.
I certainly hope they prioritize shareholders over customers. The shareholders own the place.
Exactly. That's why government intervention is necessary to ensure these companies meet a minimum threshold of competence and customer care.
Delta seems to be able to deliver an airline with fewer delays and cancelations, even wothout the govt forcing it to act. They consider it part of a product differentiator thst people will pay for. Increasing resiliency does come with a cost.
If they can manage it perfectly well without extra regulation, the extra regulation will not cost them one extra penny.
Delta performed quite poorly during the recent events. If it hadn't been for Southwest completely failing to operate, Delta would be making the news for their poor performance.
And Northwest, which is essentially half of the current Delta, performed so poorly that the current tarmac delay rules are a result of their passenger abuse
Explain then why Southwest
1. Removed the expiration date from travel credits
2. Never had a change fee when other airlines did
3. Has never instituted a baggage fee that is common industry wide.
4. Gives you a free beverage and snack
5. Compensates its employees well so they enjoy delivering customer service
Southwest has found a balance between delivering reasonable fares while not turning its product into what...
Explain then why Southwest
1. Removed the expiration date from travel credits
2. Never had a change fee when other airlines did
3. Has never instituted a baggage fee that is common industry wide.
4. Gives you a free beverage and snack
5. Compensates its employees well so they enjoy delivering customer service
Southwest has found a balance between delivering reasonable fares while not turning its product into what Frontier or Spirit are offering to squeeze out every dollar from the customers.
The frontline workers already work much harder than the executives who leech off their labor. Now they're going to be working extra hard for the avoidable screwups caused by those same lazy execs. Make the C-suite work a call center til this has been resolved...they'd finally be earning their pay for once!
I guess you think master schedules just rebuild themselves by magic or working through the grounding of the Max was no big deal.
I guarantee master schedules aren't built by the C-Suite. LOL.
No, Brian, those things were handled by mid-level employees who also work harder than the C-suite for less money.
Of course, none of this solves why this happened in the first place. Cheap fares and airlines acting more like credit card mills means they won't make investments in customer facing technology and infrastructure. So, there will be another future meltdown again on another airline.
Naturally a total dolt like our Transportation Secretary that knows zero about the airline industry (other than maybe he can be an airline CEO when his Presidential bid fails) hasn't...
Of course, none of this solves why this happened in the first place. Cheap fares and airlines acting more like credit card mills means they won't make investments in customer facing technology and infrastructure. So, there will be another future meltdown again on another airline.
Naturally a total dolt like our Transportation Secretary that knows zero about the airline industry (other than maybe he can be an airline CEO when his Presidential bid fails) hasn't figured this one out. This is not just a Southwest issue. It's a Delta, Spirit, JetBlue, American...... fill in the blank problem.
Mayor Pete getting credit for common sense?
Meanwhile...replacing their crew system will take years even if it is accelerated.
And to give you an idea of what it's like to replace that system...think of doing a heart and lung transplant on a patient while that patient is wide awake and running around the operating room.
I know...I've done SEVERAL.
I've also been a part of several replacement projects that have failed so I know what I'm talking about.
All mayor Pete did was summarize the current rules. He shouldn't get any credit for this except timing.
I've been a part of several crew scheduling infrastructure changeovers that went with only minor hiccups. Maybe yours was a poor implementation team or not enough parallel testing. It is a big project, but it is not "years", its months.
When you say infrastructure what does that mean exactly?
I'm talking about replacing the actual software.
JetBlue tried to replace CrewTrac 12 years ago and still haven't replaced it.
There is absolutely nothing off the shelf that can be implemented for Southwest.
And your point is:
That it's the transportation secretay's role to dictate how and where to invest a private company's money? Or what exactly is your point other than you dont like the guy and anything he says or does you will pick at and find fault with?
I think the "dolt" penned this letter.
And I'll be sure to come back and call you a dolt when the next airline has an operational meltdown.
American charges the same cheap fares and got their crew scheduling right. That is because they invested in technology and in executives who understand how to run an operation and recover. That loss of institutional knowledge hurt Delta, who didn't melt down but did perform not nearly as well as United or, especially, American.
This has nothing to do with cheap fares and everything to do with Southwest's historic resistance to modernizing their technology...
American charges the same cheap fares and got their crew scheduling right. That is because they invested in technology and in executives who understand how to run an operation and recover. That loss of institutional knowledge hurt Delta, who didn't melt down but did perform not nearly as well as United or, especially, American.
This has nothing to do with cheap fares and everything to do with Southwest's historic resistance to modernizing their technology to more efficient and more robust systems. They had to be dragged kicking and screaming to switch from their old garbage SASS system, that was based on a crippled version of the old COWBOY system Braniff used that SABRE took care of, to the modern Amadeus. They still have kept their paleolithic scheduling system, not to mention their absurd refusal to engage in any sort of interlining, which results in this.
"That loss of institutional knowledge hurt Delta, who didn't melt down but did perform not nearly as well as United or, especially, American."
Delta actually outperformed both of those airlines, and was the best performing airline during the travel disruptions, And through all of 2022 as a whole.
"This is not just a Southwest issue. It's a Delta, Spirit, JetBlue, American"
They have their issues, but the likes of DL (as an example) is in no way as incompetent/crippled by this particular issue, as is WN.
I think it’s a great move to outline exactly what is expected. The letter will greatly reduce any “wiggle room” . It will be very interesting to see if they can complete all the refund requests in the timeframe outlined in the letter. This is when true executive leadership sets the example.Any manager not directly involved in stabilizing the operation should be processing refunds ,answering the phones , helping to set up baggage for delivery etc .
Nothing will change for Southwest. The next winter storm will result in the same issues. Cancellation and delays. It will take six months to a year to upgrade the IT Department. In the meantime, stay away. Even if it’s a 99 cents fare special.
"It will take six months to a year to upgrade the IT Department."
Where do you get that exceptionally optimistic timeframe?
An upgrade the size that Southwest needs will A) Be phased in over a very long time, B) Require multiple complex data conversions (this is NOT easy) and C) Take MUCH MUCH MUCH longer than six months to a year.
This will be a multi-year upgrade, as it's not just "the IT Department"...
"It will take six months to a year to upgrade the IT Department."
Where do you get that exceptionally optimistic timeframe?
An upgrade the size that Southwest needs will A) Be phased in over a very long time, B) Require multiple complex data conversions (this is NOT easy) and C) Take MUCH MUCH MUCH longer than six months to a year.
This will be a multi-year upgrade, as it's not just "the IT Department" (whatever that even means) that needs upgrading; it's multiple interrelated systems across different departments (e.g., reservations, operations, frequent flyer, ground operations and control including ramp agents and scheduling, and the list goes on), many whose IT systems need upgrading and many, if not all, that are on ancient platforms running ancient code.
This holiday's debacle shone a light on Southwest's shortcomings in ways that Southwest will rue for some time, and they are in for a world of hurt and attention - the very bad kind of attention. All of it deserved.
I'm sorry, but this is not a multi-system failure. It has nothing to do with frequent flyer programs, ground operations, ramp operations. It's a failure of the IROP solver system that handles flight crews when the system falls apart. This is not a multi-year project and can be done in 6-9 months if they want to direct the resources to it.
It has been 6 days and I have not heard one single reply from. Southwest about my lost luggage.....supposedly it's in Las Vegas baggage claim Here is my totally un excusable story. On Dec 25th I was scheduled to fly on southwest from reno nev to el paso tx my flight was canceled and after being on hold for 3hrs I got my flight rescheduled for the same day at 12pm the flight was delayed...
It has been 6 days and I have not heard one single reply from. Southwest about my lost luggage.....supposedly it's in Las Vegas baggage claim Here is my totally un excusable story. On Dec 25th I was scheduled to fly on southwest from reno nev to el paso tx my flight was canceled and after being on hold for 3hrs I got my flight rescheduled for the same day at 12pm the flight was delayed for 3hrs they were waiting for a pilot...they said finally flew to Las Vegas my connecting flight was delayed for 3hrs after waiting for 4hrs they canceled the flight with my luggage and all my Christmas presents for my grandchildren and daughters family aboard the flight..they would not let us retrieve our luggage stating that the claimed baggage would be arriving in el paso that same day ...the line trying to rebook the flight was 4hrs by this time it was 9pm and the ticket agent said there wasn't. A flight till Dec 27th so I booked a flight to phenox that night at 10:50pm that flight was delayed till 1am then canceled so I paid out of pocket for a flight on frontier to phenox AZ $107.00 with a flight leaving phenox on the 26 th at 8am to el paso. I arrived to phenox at 11pm only to see that my flight the next morning was canceled through southwest ...I waited in line for 3hrs finally exhausted fell asleep on the floor along with 100 other passengers stranded woke up at 3am and got on a will call list for a flight going to San antonio TX with connecting to el paso ....that flight was delayed and I got on that flight at 8am landed in San Antonio and connecting flight was also delayed after waiting 3hrs and falling asleep I'm the floor that flight was canceled ....with all flights through southwest canceled from San antonio Airport.....distraught I purchased a flight from American airlines to el paso from phenox not San antonio....and American airlines would not refund or honor any credit to correct my mistake ....ultimately my daughters booked a amtrack train 11hrs from San antinio to el paso at 2;45am on the 27th of Dec...I booked a hotel at 7pm and arrived in el pado only to not having my baggage ever arrive at el paso airport ...today is Dec 31st and 3 trips to the Air port and have filed all reports and called and lied to about the place where my luggage is....I'm set to return home to reno on Monday Jan 2nd with no luggage and no reply from southwest by phone call or email they say it is in vegas send there is nothing they can do to make the process ho my way ......so I have filed for a refund and nothing and no phone call nothing I am very disappointed in southwest and have a return flight through them and a credit through American airlines that will still cost me another 300 plus the 230 credit ..
I know this doesn't matter to the ceo of southwest because I'm just one of thousands of passengers as I was told by southwest employee....but I am a hard working honest citizen that was looking forward to Christmas with my family it's been 6days now ....so all of these regulations mean nothing to me ...I don't forsee any refund or my luggage being returned anytime soon
Gina aurich
Stay tuned for more clusters. Who do we think is scanning and shipping all those bags? The single baggage clerk at each airport? Last summer Delta put my bag on the flight after mine. It got to the right airport three hours after me and still took three calls and 24 hours to get to me. Now multiply that by millions.
Since the Covid-19 pandemic has already proved that a significant proportion of the populace seems willing to acquiesce to "acceptable losses," common sense protective measures no longer being in vogue, perhaps we should demand that the airlines fly their posted schedule regardless of "generational weather events," and simply accept a (say) 5% "hull loss" rate due to hazardous icing conditions. Do you feel lucky?