December’s cancellation meltdown cost Dallas-based Southwest Airlines another $325 million as passengers shied away from the carrier and canceled return...
“The majority of this impact was driven by a negative revenue impact of approximately $325 million, as a result of cancellations of holiday return travel and a deceleration in bookings for January and February,” CEO Bob Jordan said Thursday in a statement. “Despite that, travel demand and revenue trends in March were strong and resulted in solid profitability for the month and record first quarter revenues.
Southwest’s December struggles and the inevitable slowdown came at an inopportune time in the travel industry, where costs are rising for wages and supplies but. Fort Worth-based American Airlines reported a first-quarter $10 million profit on Thursday, a rare gain during one of the toughest stretches of the year to make money.
“While we are mindful of the uncertain economic environment, demand for domestic air travel remains strong, thus far,” Jordan said. “Our goal remains to manage inflationary cost increases and maintain our competitive cost advantage.” Southwest Airlines canceled 16,700 flights during the last 10 days of December after a winter storm hit key hubs in Chicago and Denver.
Southwest, unprepared for the freezing temperatures, ice and snow, was forced to cancel flights and those disruptions cascaded across its network as the
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