Southwest Airlines fined $140 million over last Christmas meltdown

Southwest Airlines was hit with a $140 million civil penalty by the U.S. Department of Transportation (DOT) today for multiple consumer protection law violations both during and after the airline’s operational failures that resulted in 16,900 flight cancellations and left over two million passengers stranded over the Christmas and New Year’s holidays in 2022.

Compared to earlier DOT penalties for violations of consumer protection, this penalty is thirty times higher. The majority of the fine will be used to make up for future Southwest passengers who were impacted by the airline’s major delays or cancellations.

Along with the more than $600 million in refunds and reimbursements that the Department of Transportation (DOT) already made sure Southwest gave to travellers who experienced travel delays due to the operational meltdown, there is now a penalty. At Secretary Buttigieg’s request, Southwest Airlines made substantial modifications to its customer service plan in September 2022.

Due to DOT’s actions, Southwest will ultimately pay over $750 million for the holiday meltdown, with the majority going to passengers for reimbursements, fast rewards, refunds, or future compensation.

The order provides such relief by penalizing Southwest Airlines $140 million and compensating future Southwest passengers impacted by controllable cancellations and significant delays. Under federal law, unrealistic scheduling is considered an unfair and deceptive practice, and today’s penalty will deter airlines from engaging in any unfair and deceptive practices against consumers.