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Southwest Airlines CEO Bob Jordan takes responsibility for the company’s holiday flight meltdown: ‘It just can’t happen again’

Southwest Airlines' CEO Bob Jordan.Southwest Airlines’ CEO Bob Jordan is under pressure after recent operational failures at the carrier.

Brendan McDermid/Reuters

  • Southwest Airlines CEO Bob Jordan took responsibility for the recent holiday chaos, saying this “just can’t happen again.”
  • The carrier has engaged Oliver Wyman to review the meltdown and GE to update its software.
  • Shareholders filed a class action lawsuit on Thursday against Southwest over the flight disruptions.

Southwest Airlines CEO Bob Jordan took responsibility for the carrier’s operational meltdown over the recent holiday season, and pledged to prevent a recurrence of the chaos.

“There are a lot of reasons that this happened, but it’s on me at the end of the day,” Jordan said in an interview with Reuters on Thursday. “It’s on me to not let this happen again and to rebuild trust with our employees and rebuild trust with our customers, and we will do exactly that.”

“I have put everything on the table here because it just can’t happen again,” Jordan told Reuters.

Southwest canceled more than 16,700 flights between December 21 and 31 as the busy holiday travel season collided with a major winter storm, an outdated scheduling system, and an unconventional flight structure. 

The Dallas-based carrier estimated the meltdown in December will cost the airline up to $825 million, including lost revenue and passenger reimbursements. The carrier expects to post a net loss for the fourth quarter.

Southwest has engaged consultancy Oliver Wyman to investigate the operational failures and has set up a new committee to review its operations, Jordan told Reuters. General Electric is also helping Southwest update its software.

GE told Reuters on Thursday the software “performed as designed” during the widespread disruptions, but it’s working with Southwest to “define new functionality as they improve their crew rescheduling capability.”

On Thursday, a group of shareholders filed a class action lawsuit against Southwest over the flight disruptions. In a filing seen by Insider, the shareholders — led by Arthur Teroganesian — alleged Southwest made false or misleading statements that ignored the risks of having outdated technology, and about its unique flight structure.

Southwest’s review of the disruptions came as shareholders demand answers for the disruptions.

New York State Comptroller Thomas DiNapoli last Friday demanded to know how the carrier plans to prevent another operational meltdown. The New York state pension fund is one of the top-100 largest investors in Southwest.

“Clearly this crisis has resulted in profound customer dissatisfaction and is expected to generate significant costs to the company,” DiNapoli told Southwest’s Jordan in a letter seen by Insider. 

In the letter, DiNapoli also asked the carrier how it plans to “correct these failures – not just in the immediate term, but for the coming years.”

Southwest Airlines and GE did not immediately respond to Insider’s request for comment sent outside regular business hours.

Read the original article on Business Insider
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