Preventing the Next Southwest Airlines Meltdown

 

Congresscritters are making noises about forcing more government management of Southwest Airlines in response to Southwest’s Christmas meltdown. And alleged Transportation Secretary Buttigieg has sent a sternly worded warning to the CEO.

But as with so many things, the market is really a better disciplinary tool, and provides better incentives for Southwest to improve its performance, than what any government punishment, management, or incentive can provide.

There is no action the government can take that is likely to produce better or faster results than what will come about because Southwest now has to convince hundreds of thousands of prospective customers that it can reliably get them to their destinations. Until Southwest gets customers back on board, the CEO and other executives will be facing unhappy shareholders.

And it’s not like the federal government has any great track record of implementing reliable large-scale technology or great customer service.

Published in Domestic Policy
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  1. DrewInWisconsin, Oik Member
    DrewInWisconsin, Oik
    @DrewInWisconsin

    I say let’s blame it all on Buttigieg and maybe we can be rid of him!

    • #1
  2. David Foster Member
    David Foster
    @DavidFoster

    All Biden and his crew know how to do is to cast blame and threaten.  There seems to be no true problem-solving spirit at all in this administration.

    • #2
  3. cdor Member
    cdor
    @cdor

    David Foster (View Comment):

    All Biden and his crew know how to do is to cast blame and threaten. There seems to be no true problem-solving spirit at all in this administration.

    Well, actually his problem-solving method for conservatives is to cancel them.

    • #3
  4. Susan Quinn Contributor
    Susan Quinn
    @SusanQuinn

    The marketplace will work it out. Let’s see if Southwest can pull themselves out of this mess before the market kills them.

    • #4
  5. cdor Member
    cdor
    @cdor

    Wasn’t there a blizzard going on over most of the country during the most heavily trafficked time of the year? Was Southwest the only airline that had problems, or was it the way they treated their customers that designated that company for solitary blame? I don’t understand.

    • #5
  6. Buckpasser Member
    Buckpasser
    @Buckpasser

    DrewInWisconsin, Oik (View Comment):

    I say let’s blame it all on Buttigieg and maybe we can be rid of him!

    No.  He’s the next Presidential candidate.  His wife told him he could be it.  Why do you think he’s always too busy to deal with Supply Chain issues, rail strikes or airline SNAFUs.  He has to get those Pete Buttjudge for President signs made up.

    • #6
  7. MWD B612 "Dawg" Member
    MWD B612 "Dawg"
    @danok1

    Don’t even know what the government can do, considering what caused Southwest’s problems. Mandate that all airlines have to use the hub-and-spoke system? Direct that all airlines have to upgrade their flight/crew scheduling systems to some government standard that will have nothing to with the actual operations of an airline?

    Grandstanding idiots. And this is what to expect when a featherweight like Pete is appointed to a position where he has no useful experience.

    • #7
  8. Bryan G. Stephens Thatcher
    Bryan G. Stephens
    @BryanGStephens

    I agree but when all the airlines conspire together sometimes action is taken. 

    Personally, I think they should have to reimburse you if they don’t get you there. I just think the contract should be both ways. They get paid whether or not I show up for a flight. I don’t get to just not show up and pay them yet. They overbook flights. I can’t make a flight. They still get my money. They can’t get me where I want to go. They still get my money. 

    I simply think that the law should be that if you don’t get me there, I get paid whatever I have to pay to get where I’m going no matter how that is. If I have to book on another airline it exorbitant last minute prices. I get repaid that plus some sort of nuisance fee.

    If the government doesn’t mandate it, they will never do it. Further, I think the moment they charge me to check a bag there should be a contract that says the value of my bag will be covered no matter what is in it. Worried. I’m going to make up the fact that there’s a Frederick egg in it? Don’t lose my bag. The technology is there. Don’t lose them. 

    Now all that being said, I pay more to fly Delta. I will upgrade the Delta comfort or Delta Plus or whatever. They’re calling it these days and get my bag checked. I’ll have a little bit more leg room and free drinks. 

    I would never willingly fly southwest in the first place. This just makes that less likely.

    • #8
  9. DrewInWisconsin, Oik Member
    DrewInWisconsin, Oik
    @DrewInWisconsin

    cdor (View Comment):

    Wasn’t there a blizzard going on over most of the country during the most heavily trafficked time of the year? Was Southwest the only airline that had problems, or was it the way they treated their customers that designated that company for solitary blame? I don’t understand.

    I read an article talking about how there was a big scheduling software issue, the end result being that employees had to call in to get/report their schedules, and some were on hold for 24 hours or more?

    • #9
  10. Douglas Pratt Coolidge
    Douglas Pratt
    @DouglasPratt

    An airline has two jobs. First, make sure that airplanes don’t fall out of the air and kill people, as far as humanly possible. Second, get you where you paid to go when they told you they would.

    Southwest did okay on the first one and failed miserably on the second. Now they need to redesign their system so that it can accomplish the second job without compromising the first.

    • #10
  11. MWD B612 "Dawg" Member
    MWD B612 "Dawg"
    @danok1

    DrewInWisconsin, Oik (View Comment):

    cdor (View Comment):

    Wasn’t there a blizzard going on over most of the country during the most heavily trafficked time of the year? Was Southwest the only airline that had problems, or was it the way they treated their customers that designated that company for solitary blame? I don’t understand.

    I read an article talking about how there was a big scheduling software issue, the end result being that employees had to call in to get/report their schedules, and some were on hold for 24 hours or more?

    That, and the fact they use point-to-point for their flights rather than the hub-and-spoke system most other airlines use. That means the flight crews are scattered all over the country, and if a large number of flights gets cancelled there is no concentration of crews/planes to replace those crews/planes that were supposed to fly a continuing flight.

    • #11
  12. Full Size Tabby Member
    Full Size Tabby
    @FullSizeTabby

    cdor (View Comment):

    Wasn’t there a blizzard going on over most of the country during the most heavily trafficked time of the year? Was Southwest the only airline that had problems, or was it the way they treated their customers that designated that company for solitary blame? I don’t understand.

    Southwest uniquely screwed up. Most airlines were back on schedule by Monday. Of all the flights in the U.S. cancelled on Monday, Tuesday, Wednesday, and Thursday of this week, something like 90+ % of them were Southwest flights. According to a Wall Street Journal article, the primary culprit was an computer system insufficient for rescheduling planes and crews. Making the rescheduling more complicated for Southwest than for other airlines is that Southwest does not use the hub-and-spoke flight system that most of the other large airlines use, so Southwest could not use hubs as places to reshuffle aircraft and crews, leaving crews and aircraft scattered all over the place. 

    • #12
  13. Flicker Coolidge
    Flicker
    @Flicker

    Douglas Pratt (View Comment):

    An airline has two jobs. First, make sure that airplanes don’t fall out of the air and kill people, as far as humanly possible. Second, get you where you paid to go when they told you they would.

    Southwest did okay on the first one and failed miserably on the second. Now they need to redesign their system so that it can accomplish the second job without compromising the first.

    What if there can be only one.

    • #13
  14. Fritz Coolidge
    Fritz
    @Fritz

    A SWA pilot breaks it all down

    https://ricochet.com/1368232/a-southwest-pilot-speaks/

    • #14
  15. Percival Thatcher
    Percival
    @Percival

    MWD B612 "Dawg" (View Comment):

    DrewInWisconsin, Oik (View Comment):

    cdor (View Comment):

    Wasn’t there a blizzard going on over most of the country during the most heavily trafficked time of the year? Was Southwest the only airline that had problems, or was it the way they treated their customers that designated that company for solitary blame? I don’t understand.

    I read an article talking about how there was a big scheduling software issue, the end result being that employees had to call in to get/report their schedules, and some were on hold for 24 hours or more?

    That, and the fact they use point-to-point for their flights rather than the hub-and-spoke system most other airlines use. That means the flight crews are scattered all over the country, and if a large number of flights gets cancelled there is no concentration of crews/planes to replace those crews/planes that were supposed to fly a continuing flight.

    This right here.

    Airlines that maintain hubs are vulnerable to having their hubs swamped by bad weather. Southwest’s problem was that they didn’t have the spare personnel available to make up for previously missed flights.

    • #15
  16. JoelB Member
    JoelB
    @JoelB

    Isn’t the hub system what gets you flights from Pittsburgh to Minneapolis by way of Atlanta, Dallas, and the like? 

    • #16
  17. Percival Thatcher
    Percival
    @Percival

    JoelB (View Comment):

    Isn’t the hub system what gets you flights from Pittsburgh to Minneapolis by way of Atlanta, Dallas, and the like?

    It can, frequently to make up for personnel shortfalls somewhere along the way.

    Yu know what else has screwed up the flight personnel rosters? Some puddin’head decided that anyone not injected with a CDC-approved potion should be fired.

    • #17
  18. Steve Fast Coolidge
    Steve Fast
    @SteveFast

    Pete Butt-Cheek likes choo-choo trains and can ride his bike the last few blocks of his commute, so that gives him the authority to yell at airlines.

    • #18
  19. Charlotte Member
    Charlotte
    @Charlotte

    Steve Fast (View Comment):
    Pete Butt-Cheek

    Am I the only one who finds this sort of thing unbelievably childish?

    • #19
  20. Percival Thatcher
    Percival
    @Percival

    Charlotte (View Comment):

    Steve Fast (View Comment):
    Pete Butt-Cheek

    Am I the only one who finds this sort of thing unbelievably childish?

    Nah. It’s believably childish.

    “Unbelievably childish” is appointing someone who couldn’t get the potholes fixed in South Bend, Indiana to the post of Secretary of Transportation because he checks off an administration diversity box.

    • #20
  21. MarciN Member
    MarciN
    @MarciN

    Percival (View Comment):
    Airlines that maintain hubs are vulnerable to having their hubs swamped by bad weather.

    And they have many other problems too. I admire Southwest for not using them. 

    But I can see the problem with shuffling personnel around if they don’t use them. 

     

    • #21
  22. Steve Fast Coolidge
    Steve Fast
    @SteveFast

    Charlotte (View Comment):

    Steve Fast (View Comment):
    Pete Butt-Cheek

    Am I the only one who finds this sort of thing unbelievably childish?

    Probably – I rather enjoy it.

    • #22
  23. cdor Member
    cdor
    @cdor

    This link from Fritz is a Southwest longtime employee breaking down what happened and why:

    https://ricochet.com/1368232/a-southwest-pilot-speaks/

    One problem was created by an unsophisticated communication system that didn’t facilitate the flight crews getting the releases to take off. I don’t understand a lot of this, but apparently Southwest’s problems have been bubbling to the top for several decades. COVID supplied a two year masking and the relatively benign storm last Thursday lit a fuse the blew them up.

    • #23
  24. cdor Member
    cdor
    @cdor

    cdor (View Comment):

    This link from Fritz is a Southwest longtime employee breaking down what happened and why:

    https://ricochet.com/1368232/a-southwest-pilot-speaks/

    One problem was created by an unsophisticated communication system that didn’t facilitate the flight crews getting the releases to take off. I don’t understand a lot of this, but apparently Southwest’s problems have been bubbling to the top for several decades. COVID supplied a two year masking and the relatively benign storm last Thursday lit a fuse the blew them up.

    I should have given proper attribution to Douglass Pratt whose posted the original.

    • #24
  25. Bryan G. Stephens Thatcher
    Bryan G. Stephens
    @BryanGStephens

    cdor (View Comment):

    This link from Fritz is a Southwest longtime employee breaking down what happened and why:

    https://ricochet.com/1368232/a-southwest-pilot-speaks/

    One problem was created by an unsophisticated communication system that didn’t facilitate the flight crews getting the releases to take off. I don’t understand a lot of this, but apparently Southwest’s problems have been bubbling to the top for several decades. COVID supplied a two year masking and the relatively benign storm last Thursday lit a fuse the blew them up.

    And the executives who ignored the warning won’t suffer. 

    Shareholders ought to be able to sue the previous CEO and take every penny the man has. 

     

    • #25
  26. cdor Member
    cdor
    @cdor

    Bryan G. Stephens (View Comment):

    cdor (View Comment):

    This link from Fritz is a Southwest longtime employee breaking down what happened and why:

    https://ricochet.com/1368232/a-southwest-pilot-speaks/

    One problem was created by an unsophisticated communication system that didn’t facilitate the flight crews getting the releases to take off. I don’t understand a lot of this, but apparently Southwest’s problems have been bubbling to the top for several decades. COVID supplied a two year masking and the relatively benign storm last Thursday lit a fuse the blew them up.

    And the executives who ignored the warning won’t suffer.

    Shareholders ought to be able to sue the previous CEO and take every penny the man has.

     

    If I were sitting next to you, Bryan, I’d buy you a whiskey.

    • #26
  27. Metalheaddoc Member
    Metalheaddoc
    @Metalheaddoc

    While I am not in favor of government regulation, the EU 261 rule does seem to work to incentivize carriers to get people where they are going. There are specific compensations for specific delays and cancellations. There are carve outs for weather and things out of their control. But it seems the like the rule is enforced in such a way that the airlines can’t just say “it was weather” and get out of it. Scheduling problems, mechanical problems, crew problems aren’t carved out. The airlines have pay up. They have paid out compensation into the millions since the regulation was implemented. The airlines can weasel out of it by offering you some other (lesser) compensation on the spot. If you take that, you can’t file a 261 claim. 

    The process isn’t necessarily fast. I got money back from Lufthansa for a cancelled flight during the summer. But I am still waiting for Aegean to pay me back for a 5 hour delay.  

    • #27
  28. Steve Fast Coolidge
    Steve Fast
    @SteveFast

    Metalheaddoc (View Comment):

    While I am not in favor of government regulation, the EU 261 rule does seem to work to incentivize carriers to get people where they are going. There are specific compensations for specific delays and cancellations. There are carve outs for weather and things out of their control. But it seems the like the rule is enforced in such a way that the airlines can’t just say “it was weather” and get out of it. Scheduling problems, mechanical problems, crew problems aren’t carved out. The airlines have pay up. They have paid out compensation into the millions since the regulation was implemented. The airlines can weasel out of it by offering you some other (lesser) compensation on the spot. If you take that, you can’t file a 261 claim.

    The process isn’t necessarily fast. I got money back from Lufthansa for a cancelled flight during the summer. But I am still waiting for Aegean to pay me back for a 5 hour delay.

    If there were competition in the passenger air travel market, then some companies would build a better reputation of either not being late or compensating passengers. Of course, it would cost them more to ensure that there would be, for example, a 99.9% chance of having a flight crew available instead of a 95% chance. So they would charge their customers more, and passengers who valued getting somewhere on time would pay the extra $50 to fly with them. Or if you were a poor student flying somewhere and didn’t mind risking a 5% chance of sleeping on the floor in an airport, then you could save the $50 and spend it on extra beer at your destination. But in the absence of competition, a well-designed regulation such as you mention is the next best solution.

    Of course, the reason that we don’t have competition in the market is because the handful of remaining airlines have captured the regulators and created barriers to entry that make it virtually impossible to start a new airline with a different customer service model. And that same regulatory capture is what makes most of the regulations on delay compensation so toothless.

    • #28
  29. Full Size Tabby Member
    Full Size Tabby
    @FullSizeTabby

    Steve Fast (View Comment):

    Metalheaddoc (View Comment):

    While I am not in favor of government regulation, the EU 261 rule does seem to work to incentivize carriers to get people where they are going.  [snip].

    If there were competition in the passenger air travel market, then some companies would build a better reputation of either not being late or compensating passengers. Of course, it would cost them more to ensure that there would be, for example, a 99.9% chance of having a flight crew available instead of a 95% chance. So they would charge their customers more, and passengers who valued getting somewhere on time would pay the extra $50 to fly with them. Or if you were a poor student flying somewhere and didn’t mind risking a 5% chance of sleeping on the floor in an airport, then you could save the $50 and spend it on extra beer at your destination. But in the absence of competition, a well-designed regulation such as you mention is the next best solution.

    Of course, the reason that we don’t have competition in the market is because the handful of remaining airlines have captured the regulators and created barriers to entry that make it virtually impossible to start a new airline with a different customer service model. And that same regulatory capture is what makes most of the regulations on delay compensation so toothless.

    And one of my concerns about a regulatory solution such as requiring compensation for delays is that such a regulation itself is a barrier to entry for competing airlines. 

    Southwest once was the low cost outlier whose customers knew they would be herded like cattle, not fed in-flight meals, and that Southwest had no exchanges with other airlines, so Southwest couldn’t put you on another airline if your reserved airline couldn’t get you to your destination, and thus were more likely to have a significant delay on Southwest if a problem arose. [United Airlines has put me on an American flight when United had an aircraft problem.] But over the last several years the “legacy” airlines have done more herding, stopped in-flight meals, and become very reluctant to move passengers to another airline to get them to their destination, so the fare differential between the “legacy” airlines and Southwest have pretty much disappeared. 

    • #29
  30. Metalheaddoc Member
    Metalheaddoc
    @Metalheaddoc

    Full Size Tabby (View Comment):

    Steve Fast (View Comment):

    Metalheaddoc (View Comment):

    While I am not in favor of government regulation, the EU 261 rule does seem to work to incentivize carriers to get people where they are going. [snip].

    If there were competition in the passenger air travel market, then some companies would build a better reputation of either not being late or compensating passengers. Of course, it would cost them more to ensure that there would be, for example, a 99.9% chance of having a flight crew available instead of a 95% chance. So they would charge their customers more, and passengers who valued getting somewhere on time would pay the extra $50 to fly with them. Or if you were a poor student flying somewhere and didn’t mind risking a 5% chance of sleeping on the floor in an airport, then you could save the $50 and spend it on extra beer at your destination. But in the absence of competition, a well-designed regulation such as you mention is the next best solution.

    Of course, the reason that we don’t have competition in the market is because the handful of remaining airlines have captured the regulators and created barriers to entry that make it virtually impossible to start a new airline with a different customer service model. And that same regulatory capture is what makes most of the regulations on delay compensation so toothless.

    And one of my concerns about a regulatory solution such as requiring compensation for delays is that such a regulation itself is a barrier to entry for competing airlines.

    Southwest once was the low cost outlier whose customers knew they would be herded like cattle, not fed in-flight meals, and that Southwest had no exchanges with other airlines, so Southwest couldn’t put you on another airline if your reserved airline couldn’t get you to your destination, and thus were more likely to have a significant delay on Southwest if a problem arose. [United Airlines has put me on an American flight when United had an aircraft problem.] But over the last several years the “legacy” airlines have done more herding, stopped in-flight meals, and become very reluctant to move passengers to another airline to get them to their destination, so the fare differential between the “legacy” airlines and Southwest have pretty much disappeared.

    I don’t see why that is a barrier to entry. You would have to have an operational setup to minimize delays. Are you saying that new upstart airlines have to have crappy performance just because they are small? Would you be in favor of such a compensation regulation kicking in only after an airline has reached a certain size which would allow growth and development and refinement before potentially getting penalized?

    • #30
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