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After its wave of holiday flight cancellations caused confusion for travelers and sparked heightened regulatory scrutiny, Southwest Airlines acknowledged it expected to take a major financial damage this quarter.
After canceling more than 16,000 flights since last week, the troubled airline has being urged to compensate its incensed passengers financially.
Southwest verified it was back to “running our normal schedule” in an update posted on the airline website Friday morning, adding it anticipated “minimal disruptions for the weekend.”
Southwest’s finances are anticipated to suffer as a result of the impact. According to some financial analysts, Southwest’s holiday meltdown might cause its anticipated fourth-quarter earnings to drop by much to 9%, according to Reuters.
During a conference call with reporters, Southwest’s chief commercial officer Ryan Green hinted to impending financial consequences, saying, “There’ll definitely be an impact in the fourth quarter.”
Green stated on Thursday in the afternoon, “We’re… going through all the financial aspects of this. When we have everything gathered and are prepared to do so, we will provide that information.
After receiving strong criticism from lawmakers and Treasury Secretary Pete Buttigieg, Southwest executives stated they intend to refund tickets for affected customers as well as reimburse for meals, lodging, and rental cars.
The business has chosen not to disclose how many of its clients were impacted by the meltdown or to give a more precise estimate. Green agreed that processing all of the reimbursements by Southwest would probably take weeks.
Green stated during the call that expenses for hotels, meals, rental cars, and gas for the rental car would be eligible for reimbursement.
The majority of recent flight cancellations occurred due to Southwest as severe winter weather battered most of the nation. The airline is criticized for having outdated equipment that prevents it from being able to respond to staffing shortages caused by employees calling in sick.
The airline issued a statement saying, “Once again, we value the continuing patience and support of our loyal Customers and we apologize for the inconveniences of the previous week.”
According to FlightAware statistics, the airline canceled 41 flights on Friday, or approximately 1% of its planned itinerary, after canceling more than 2,300 trips the day before and more than 16,000 in the previous seven days.
In a letter to CEO Bob Jordan on Thursday, Buttigieg blasted Southwest Airlines for “unacceptable” travel interruptions. Southwest must “start by compensating travelers for those costs that can be assessed in dollars and cents,” he insisted.
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