The Department of Transportation recently rescinded a Biden-era $11 million penalty on Southwest Airlines, revising a 2023 enforcement order tied to the carrier’s handling of mass disruptions after severe winter weather.
The updated order amends DOT’s 2023 directive that fined Southwest $140 million. Under the original terms, $35 million was to be paid to the U.S. Treasury in three installments. Southwest made the first two payments — $12 million in February 2024 and another $12 million in January 2025. Under Friday’s revision, the airline will no longer have to make the final $11 million payment. Instead, DOT granted Southwest an $11 million credit for improvements in on-time performance and its completion factor — the share of scheduled flights operated without major disruption—according to the order.
DOT initially penalized Southwest over what it described as failures to provide prompt or proper refunds, timely flight-status notifications, and adequate customer assistance after winter storms drove widespread disruptions in December 2022 and January 2023.
Of the remaining $105 million included in the original penalty, $72 million is set to be offset in exchange for $90 million in customer vouchers that DOT ordered Southwest to provide from April 2024 through April 2027. Another $33 million was credited after Southwest issued 25,000 Rapid Rewards points to affected passengers.
The order also points to Southwest’s operational investments since the storm, saying the airline has spent more than $1 billion on performance and reliability improvements, including more than $112.4 million on its network operations control system.
DOT said that over the first nine months of this year, Southwest ranked third among the 10 largest U.S. commercial airlines in both on-time performance and completion factor. In 2022, the department said, Southwest ranked sixth and eighth in those categories, respectively. The department’s most recent data shows that as of July, 77.5% of Southwest flights arrived on time this year, placing the airline fourth on that list.
Southwest welcomed the change. The company said it is “grateful to [Transportation] Secretary [Sean] Duffy and the DOT Team for recognizing Southwest’s significant investments in modernizing our operations.”
“During the last two years, Southwest successfully completed an operational turnaround that directly benefits our Customers with industry-leading on-time performance and percentage of completed flights without cancellations,” the company added.
The revision comes after another regulatory setback earlier this year. In May, the Justice Department dismissed a case brought by DOT under former Transportation Secretary Pete Buttigieg. In that matter, DOT alleged Southwest advertised unrealistic flight schedules despite chronic delays in 2022.
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