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What really is going on at Southwest Airlines –
Unions saw this perfect storm coming for years!

“A traveler gets help from Southwest Airlines staff as she tries to find her missing luggage on December 27, 2022 in Los Angeles.” Credit: Irfan Khan/Los Angeles Times via Getty Images, and Common Dreams.

Southwest Airlines Spent $5.6 Billion on Shareholder Gifts in Years Ahead of Mass Cancellation Crisis

“Southwest Airlines made a risky gamble that mass layoffs and spending billions of dollars on handouts to investors rather than fixing infrastructure would pay off with record profits,” said one watchdog. “The airline lost that bet badly.”

By Jake Johnson, Common Dreams:

As travelers and airline workers reel from mass flight cancellations, a corporate watchdog noted Wednesday that Southwest spent nearly $6 billion on stock buybacks in the years ahead of the coronavirus pandemic instead of devoting those resources to technological improvements that unions have been demanding for years.

According to Accountable.US, the crisis Southwest has experienced in recent days amid a massive winter storm is “a problem of its own making.” The organization pointed out that the airline opted “to spend $5.6 billion on stock buybacks in the three years leading up to the pandemic rather than making investments in infrastructure to be better prepared for extreme weather events like this week.”

The watchdog group added that the company “even reinstated dividends earlier this month, the first major airline to do so after the pandemic.”

Southwest Airlines made a risky gamble that mass layoffs and spending billions of dollars on handouts to investors rather than fixing infrastructure would pay off with record profits,” Kyle Herrig, the president of Accountable.US, said in a statement. “The airline lost that bet badly and now it’s their customers left paying the price including the thousands stranded in the middle of holiday season travel.”

“Southwest’s well-compensated executives could have prioritized its workers and customers by preparing for the worst, but greed trumped all as they put a small group of wealthy investors first,” Herrig added. “Consumers shouldn’t be the ones stuck holding the bag for Southwest’s greedy management decisions, but here we are. This is where the Transportation Department should start in any investigation into why this happened.”

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Unions representing flight attendants and pilots have said that while the winter storm fueled some of the cancellations, deliberate decisions by Southwest management were ultimately responsible for what’s been described as the company’s “full-blown meltdown.”

Specifically, the vice president of the Southwest Airlines Pilots Association toldInsider that the company’s “outdated” scheduling software has been overwhelmed, wreaking havoc on operations.

Sanders Calls on Buttigieg to Hold Southwest CEO Accountable for ‘Greed and Incompetence’

“This is a company that got a $7 billion taxpayer bailout and will be handing out $428 million in dividends to their wealthy shareholders,” said Sen. Bernie Sanders.

From Common Dreams:

Sen. Bernie Sanders on Wednesday urged the Transportation Department to ensure Southwest’s chief executive pays a price for mass U.S. flight cancellations that have left passengers and employees stranded around the country, throwing lives into chaos and drawing further attention to the company’s business practices.

“Southwest’s flight delays and cancellations are beyond unacceptable,” Sanders (I-Vt.) wrote on Twitter. “This is a company that got a $7 billion taxpayer bailout and will be handing out $428 million in dividends to their wealthy shareholders. The U.S. Department of Transportation must hold Southwest’s CEO accountable for his greed and incompetence

The New York Times: The Shameful Open Secret Behind Southwest’s Failure

‘Perfect storm’ of internal and external problems broke Southwest Airlines

From MSNBC:

Justin George, transportation reporter for the Washington Post, discusses the “perfect storm” of broken internal systems and extreme weather events that shattered service by Southwest Airlines, cancelling thousands of flights and stranding thousands of passengers. 

From a Southwest Pilot posted to the Eastern Airlines Facebook page [of which this writer is a member]

What happened to Southwest Airlines?

I’ve been a pilot for Southwest Airlines for over 35 years. I’ve given my heart and soul to Southwest Airlines during those years. And quite honestly Southwest Airlines has given its heart and soul to me and my family.

Many of you have asked what caused this epic meltdown. Unfortunately, the frontline employees have been watching this meltdown coming like a slow motion train wreck for sometime. And we’ve been begging our leadership to make much needed changes in order to avoid it. What happened yesterday started two decades ago.

Herb Kelleher was the brilliant CEO of SWA until 2004. He was a very operationally oriented leader. Herb spent lots of time on the front line. He always had his pulse on the day to day operation and the people who ran it. That philosophy flowed down through the ranks of leadership to the front line managers. We were a tight operation from top to bottom. We had tools, leadership and employee buy in. Everything that was needed to run a first class operation. When Herb retired in 2004 Gary Kelly became the new CEO.

Gary was an accountant by education and his style leading Southwest Airlines became more focused on finances and less on operations. He did not spend much time on the front lines. He didn’t engage front line employees much. When the CEO doesn’t get out in the trenches the neither do the lower levels of leadership.

Gary named another accountant to be Chief Operating Officer (the person responsible for day to day operations). The new COO had little or no operational background. This trickled down through the lower levels of leadership, as well.

They all disengaged the operation, disengaged the employees and focused more on Return on Investment, stock buybacks and Wall Street. This approach worked for Gary’s first 8 years because we were still riding the strong wave that Herb had built.

But as time went on the operation began to deteriorate. There was little investment in upgrading technology (after all, how do you measure the return on investing in infrastructure?) or the tools we needed to operate efficiently and consistently. As the frontline employees began to see the deterioration in our operation we began to warn our leadership. We educated them, we informed them and we made suggestions to them. But to no avail. The focus was on finances not operations. As we saw more and more deterioration in our operation our asks turned to pleas. Our pleas turned to dire warnings. But they went unheeded. After all, the stock price was up so what could be wrong?

We were a motivated, willing and proud employee group wanting to serve our customers and uphold the tradition of our beloved airline, the airline we built and the airline that the traveling public grew to cheer for and luv. But we were watching in frustration and disbelief as our once amazing airline was becoming a house of cards.

A half dozen small scale meltdowns occurred during the mid to late 2010’s. With each mini meltdown Leadership continued to ignore the pleas and warnings of the employees in the trenches. We were still operating with 1990’s technology. We didn’t have the tools we needed on the line to operate the sophisticated and large airline we had become. We could see that the wheels were about ready to fall off the bus. But no one in leadership would heed our pleas.

When COVID happened SWA scaled back considerably (as did all of the airlines) for about two years. This helped conceal the serious problems in technology, infrastructure and staffing that were occurring and being ignored. But as we ramped back up the lack of attention to the operation was waiting to show its ugly head.

Gary Kelly retired as CEO in early 2022. Bob Jordan was named CEO. He was a more operationally oriented leader. He replaced our Chief Operating Officer with a very smart man and they announced their priority would be to upgrade our airline’s technology and provide the frontline employees the operational tools we needed to care for our customers and employees. Finally, someone acknowledged the elephant in the room.

But two decades of neglect takes several years to overcome. And, unfortunately to our horror, our house of cards came tumbling down this week as a routine winter storm broke our 1990’s operating system.

The frontline employees were ready and on station. We were properly staffed. We were at the airports. Hell, we were ON the airplanes. But our antiquated software systems failed coupled with a decades old system of having to manage 20,000 frontline employees by phone calls. No automation had been developed to run this sophisticated machine.

We had a routine winter storm across the Midwest last Thursday. A larger than normal number flights were cancelled as a result. But what should have been one minor inconvenient day of travel turned into this nightmare. After all, American, United, Delta and the other airlines operated with only minor flight disruptions.

The two decades of neglect by SWA leadership caused the airline to lose track of all its crews. ALL of us. We were there. With our customers. At the jet. Ready to go. But there was no way to assign us. To confirm us. To release us to fly the flight. And we watched as our customers got stranded without their luggage missing their Christmas holiday.

I believe that our new CEO Bob Jordan inherited a MESS. This meltdown was not his failure but the failure of those before him. I believe he has the right priorities. But it will take time to right this ship. A few years at a minimum. Old leaders need to be replaced. Operationally oriented managers need to be brought in. I hope and pray Bob can execute on his promises to fix our once proud airline. Time will tell.

It’s been a punch in the gut for us frontline employees. We care for the traveling public. We have spent our entire careers serving you. Safely. Efficiently. With luv and pride. We are horrified. We are sorry. We are sorry for the chaos, inconvenience and frustration our airline caused you. We are angry. We are embarrassed. We are sad. Like you, the traveling public, we have been let down by our own leaders.

Herb once said the the biggest threat to Southwest Airlines will come from within. Not from other airlines. What a visionary he was. I miss Herb now more than ever.

Larry Lonero

Posted by Steve on December 29, 2022 at 7:01 am | Permalink

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