Reeling from one of the worst months in company history, Southwest Airlines leaders are trying to figure out what options there are, if any, to prevent another cancellation meltdown.
Make it up to thousands of disgruntled passengers? Apologies, refunds, reimbursements and flight credits should help.
Fix and upgrade “overmatched” crew scheduling systems? Eventually.
Stop another wave of cancellations the next time bad weather hits? It’s the only thing that matters if Southwest hopes to recover, travel industry veterans and analysts said.
Flights for Dallas-based Southwest Airlines have returned mostly to normal over the last six days since the carrier shut down two-thirds of its operations to reset from a cascading avalanche of 17,000 cancellations around the busy Christmas travel holiday.
The carrier is now trying to figure out how to fix a crew scheduling software system that buckled and broke following a winter storm that hit major bases in Denver and Chicago. Thousands of pilots and flight attendants were out of place and unaccounted for as airline management tried to locate them and get them back in the air, only for plans to fall apart over and over again.
“There will be immediate work to understand what lessons are learned here and how we keep this from ever happening again, because it cannot happen again,” CEO Bob Jordan said in a video message to Southwest’s 66,000 employees.
Jordan and other Southwest leaders have admitted it will take time — possibly months and years — to replace outdated technology infrastructure that led to the holiday breakdown. That system, called SkySolver, was unable to keep up with the number of cancellations and delays as it tried to find new flights for pilots and flight attendants.
In the meantime, they will need plans to prevent another strong storm from crippling flight operations and stranding millions more passengers.
“Some of these systems are so complex, they take time and you can’t do this in three months or six months,” Jordan said in a call with reporters last week. “When we replaced our maintenance system, it was a multi-year project.”
Analysts and airline industry veterans said the company may need to take drastic steps while it invests in a new system to schedule and accommodate pilots and flight attendants during periods of heavy delays and cancellations.
Southwest may need to sharply cut flights, rethink its trademark point-to-point route network or take the expensive step of canceling large swaths of flights when strong storms are in the forecast, they said.
“It’s always reliability versus cost structure, and reliability is expensive,” said H. Blair Pomeroy, an assistant business professor at the University of Pittsburgh and a former employee at American Airlines, United and Qatar Airways. “The world’s best software is not going to get you out of this situation.”
“It’s really people, process and technology,” Pomeroy said. “You need all three.”
After a wave of mass cancellations in 2021 and early 2022 as the airline industry recovered from the COVID-19 pandemic and reduced workforces, carriers such as Southwest cut thousands of flights heading into the summer in order to make sure it could handle a surge of leisure travelers.
Pomeroy said Southwest has few options but to cut schedules again, particularly during peak periods when planes are more full and there are fewer options to rebook passengers. Southwest has planned its biggest flight schedule in history for the coming months, including more than 130,000 flights in July, according to Cirium.
“One of the emerging best practices that is so painful is to preemptively cancel if there is bad weather in one region,” Pomeroy said. “But preemptively canceling is so hard because people can get upset and you lose money, especially if the weather isn’t that bad.”
Andrew Watterson, who took over the chief operating officer job in October from longtime leader Mike Van De Ven, said the company has come up with a three-pronged plan to prevent another meltdown while it accelerates a total overhaul of the flawed crew scheduling software.
First, executives created a system for the company to take over pilot and flight attendant rescheduling manually, using a team of about 1,000 volunteers at corporate headquarters who made phone calls to find out where crew members were and when they could fly again. Second, it needs to make incremental patches and changes to its crew modeling software. Third, he said, the company needs to come up with plans for key airports where pilots and flight attendants are based.
Watterson said it’s hard to say unequivocally that something will never happen again. “It’s almost an unfair question,” he said, “but you can say what will you do to improve how you handle it next time, which I think would be a fair question.”
Southwest may have to change some longstanding company practices to get to the core of the problems though, said Kevin Woods, the Southlake-based founder of aviation technology company Zulu Airline Systems.
“Southwest has invested in their own technology, and it’s been one of its major problems,” Woods said. “Outside technology is almost always better and more reliable because you have experts building it who work across several companies.”
Most of all, Southwest leaders are going to need to spend time taking a hard look at their company philosophies around technology and reliability, said Bill Swelbar, an aviation analyst with Swelbar-Zhong Consultancy.
“The airline needs to look at itself, and it needs to be introspective,” Swelbar said. “This isn’t the first time Southwest has been in the headlines over cancellations, so there have been some tea leaves dropped.”
In October 2021, Southwest had an operational meltdown that led to 2,000 flight cancellations and cost $75 million in lost revenue. Estimates place the financial toll this time in the $500 million to $700 million range.
Union contracts will also need to be reworked for more flexibility and efficiency, and the company will have to listen to pilots and flight attendants who spent nights in airports while the company tried to track them down.
“They need to get operations, pilots, crew scheduling, all those people will have to sit down, get out of their silo and figure out how to work this out holistically.”
