Business & Investment

Southwest Airlines flight turmoil is the latest headache for airlines.

Southwest Airlines’ canceled battle weekends are exacerbated by significant airline cuts, and other airlines must create flight schedules that can increase the airline’s workforce and costs. did not.


Passengers were stranded after canceling about 2,000 flights over the weekend and delaying hundreds more. In trading at noon on Monday, stocks fell nearly 3%, compared to flat US Global Jet ETFs.

And S & P 500 Index

Despite the loss of stock, Wall Street seemed to see weekend obstacles as having a limited impact on stock and company earnings.

But more worrisome, the cancellation “is wondering if the schedule is too long compared to the limited staff level (in the southwest),” Citi’s Stephen Trent said in a Monday note. Stated.

Raymond James’ Savanti Sith said Southwest unit pressures would also increase and “may worsen tense trade union relations.”

Airlines have blamed widespread cancellations of weather “challenges” at some of Florida’s airports, exacerbating “unexpected” air traffic control issues in the same area.

The FAA said on Twitter on Sunday that no air traffic shortages have been reported since Friday. “Wide weather, military training, and limited staffing” in the Jacksonville area of ​​Florida caused “hours” flight delays and cancellations on Friday afternoons and evenings, he said.

“Some airlines continue to experience scheduling challenges due to the out-of-place aircraft and crew,” FAA said.

However, other airlines, even those with several Florida hubs, did not report as serious a problem as Southwest Airlines.Pilot union can be canceled It was not part of a labor-related protest.

The situation was exacerbated by the small number of flights that could be rebooked.

Southwest Airlines said in August that it would reduce the number of flights by the end of the year to tailor flights to demand and staff operations and staff, except during holiday hours.

With a view to vacation trips in November and December, the company offers employee referral bonuses and other incentives to encourage more workers to be hired.

Related: Goldman Sachs has downgraded American Airlines and JetBlue, but airlines still say it’s “positive.”

Both strategies weren’t just for Southwest Airlines. Due to the exhaustion of bookings during the pandemic, airlines have reduced their ability to stay on the water and continued to fall below 2019 bookings despite the rise in the summer.

And new pandemic-related demands, including an increase in incidents involving unruly passengers, have led to overworked employees.

Earlier this month IATA said demand is expected to reach 61% of 2019 levels in 2022 and remain at 40% this year. The aviation industry around the world expects to lose $ 11.6 billion in 2022.

IATA is also becoming more pessimistic this year, expecting a loss of $ 51.8 billion, compared to an estimated $ 47.7 billion loss in April.

“The magnitude of the COVID-19 crisis for airlines is immeasurable. Between 2020 and 2022, total loss could exceed $ 200 billion,” said IATA. “For airlines to survive, we have dramatically reduced costs and adapted our business to every available opportunity.”

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The glory includes the airline’s air cargo business, and domestic travel is likely to approach pre-crisis levels by next year, IATA said. Traveling abroad remains a challenge.

Especially US airlines had to do it too Without a surge in demand due to business trips Historically, it’s a bridge between the end of summer and the beginning of the holiday season.

However, due to the continued resurgence of COVID-19 cases and concerns about delta mutations, a return of business trips is expected during the January conference season.

Southwest’s share has risen about 12% so far this year, compared to about 7% for jet ETFs and about 17% for S & P.

Southwest Airlines flight turmoil is the latest headache for airlines. Southwest Airlines flight turmoil is the latest headache for airlines.

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