The airline said it was pleased to reach a “consumer-friendly settlement.”
Southwest Airlines has been fined a record $140 million over an operational collapse during the 2022 holiday travel season, the U.S. Department of Transportation said Monday.
The civil penalty imposed on the airline is about 30 times larger than any previous fine against an airline, DOT officials said in a press release.
The Department of Transportation said it will also require Southwest to begin issuing a $75 flight credit to any passenger whose arrival is delayed by more than 3 hours when it is the airline’s fault, including mechanical issues.
“Today’s action sets a new precedent and sends a clear message: If airlines fail their passengers, we will use the full extent of our authority to hold them accountable,” Transportation Secretary Pete Buttigieg said in a statement.
The Department of Transportation said the $140 million fine adds to about $600 million in recoveries and compensation previously agreed upon over the collapse. Officials said they will use the majority of the fine to compensate customers affected by future Southwest flight cancellations and other delays.
As a massive winter storm hit the United States during the 2022 holiday season, the airline canceled more than 16,900 flights, stranding more than 2 million passengers, the Department of Transportation said.
Southwest said it “learned from the event” and made new investments to improve customer service and “our flexibility.”
“We are pleased to have reached this consumer-friendly settlement, which includes a new, industry-leading policy to compensate customers during significant delays and cancellations,” the airline said in a press release.
Transportation officials said their investigation into the day-long incident included “examining tens of thousands of pages of documents, conducting multiple, multi-day in-person audits and site visits at Southwest headquarters, reviewing thousands of consumer complaints, and consulting with various third parties, such as airports.” “
That investigation found that the airline violated consumer protection laws regarding its provision of customer service, prompt notifications of flight status and quick refunds, DOT officials said Monday.
Department of Transportation officials said they ordered Southwest to reserve $90 million worth of vouchers to cover the $75 flight credit the airline will be required to pay when flights are delayed more than 3 hours.
“Caring for passengers is not just the right thing to do, it’s required, and this penalty should alert all airlines to take every step possible to ensure a crash like this never happens again,” Buttigieg said in a statement.
“Devoted student. Bacon advocate. Beer scholar. Troublemaker. Falls down a lot. Typical coffee enthusiast.”