Nightmare Almost Over? Southwest Expects Operations To Normalize By Dec. 30: Report

Many Americans were locked in place during the holidays.

Christmas holiday travel plans were largely halted as winter-storm Elliot — which later turned into a bomb cyclone — blew its high winds and icy snow at sub-zero temperatures across most of the continental U.S.

Most airlines, like Delta Air Lines, Inc. (NYSE: DAL), American Airlines Group Inc (NASDAQ: AAL), and United Airlines Holdings Inc (NASDAQ: UAL) have recovered, and mostly back to regular operations, the kerfuffle is worsening for one airline carrier.

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What Happened: Southwest Airlines Co (NYSE: LUV) expects minimal disruptions by Dec. 30, according to Reuters.

The news comes after the carrier canceled more than 13,000 flights (and counting), leaving thousands of customers and its own employees stranded in airports.

The Dallas-based company will continue operating on a lean, or reduced flying schedule for a few more days, Southwest CEO Robert Jordan said in a statement late Tuesday.

The company's "point-to-point" model, in which passengers fly directly from smaller cities and regions without having to stop at a central hub like Denver or New York, is said to be the cause of the severe fallout, according to The New York Times.

Point-to-point flights reduce travel times by omitting the intermediate stop, which is often a significant benefit for passengers who are not flying from major metro regions, in contrast to other airline operators who use a "hub-and-spoke" structure.

The point-to-point model, coupled with Southwest’s long-outdated software from the 1990s, has caused the cancellations which created a ripple effect across its network.

While the company said it has a reserve of standby crew members and pilots, its very unorganized back-end system which — under federal regulation — matches crew to flights, could not keep track of where its crew members and pilots were after so many flights were canceled.

Why It’s Important: Washington and the Transportation Department, which said it was looking into Southwest's "unacceptable" treatment of cancellations, have renewed their probe of the airline's poor management of its flights.

Disgruntled air travelers had their plans upended by the disruption at a time when industry leaders and experts voiced confidence in Southwest's capacity to manage the influx of Christmas travelers.

Transportation Secretary Pete Buttigieg told Jordan that he expected the company to live up to the commitments and said that if it doesn't, then Buttigieg’s department "will take action to hold Southwest accountable," according to a Transportation Department spokesperson.

What’s Next: Southwest’s Chief Commercial Officer Ryan Green offered travelers an update Wednesday, saying that the company has extended flexibility for self-service travel changes through Jan 2.

Meaning, all Southwest customers can make free changes to their flights to avoid any further disruptions at airports.

Green also said that a Southwest customer missing luggage should visit its website, and submit a claim for how to retrieve luggage, at no extra cost.

Customers can also submit a request for full-reimbursement related to cancelled flights.

If travelers had garnered expenses related to cancelled flights (i.e., hotel stays, clothing costs, rental cars, etc.), Green says to save the receipts and submit them on Southwest’s website for full-reimbursement.
Price Action: Shares of Southwest Airlines are trading 3.76% higher Thursday to $33.40, according to data from Benzinga Pro. 

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