Southwest Airlines hit with huge fine for Christmas IT fiasco

(Image credit: Shutterstock)

The US Department of Transport (DoT) has revealed details of an eye-watering $140 million fine facing Southwest Airlines following its catastrophic IT outage over Christmas 2022.

The DoT says that the civil penalty, which is thirty times larger than any other previous DoT penalty for consumer protection violations, is the result of “numerous violations of consumer protection laws.”

Two million passengers and 16,900 flights were cancelled during the Christmas and New Year period last year after Southwest Airlines experienced the outage.

Southwest Airlines outage

The trouble came as the Texas-headquartered airline was forced to reschedule flights in the wake of the December 21 storm, which lasted until December 26. By December 27, it was revealed that the company’s operational systems were struggling to keep up with the large number of rescheduled flights, causing headaches for some passengers into the early days of January 2023.

Together with more than $600 million in refunds and reimbursements to passengers who faced disruptions during the “meltdown,” Southwest Airlines will have paid in excess of $750 million for this incident.

US Transportation Secretary Pete Buttigieg commented: “Today’s action sets a new precedent and sends a clear message: if airlines fail their passengers, we will use the full extent of our authority to hold them accountable.”

The DoT said that the fine, which comes almost 12 months after the chaos first began, is based on the examination of “tens of thousands of pages of documents” as well as “several multi-day, in-person audits” and visits to Southwest’s Dallas HQ.

The Department of Transport was particularly concerned that Southwest Airlines failed to provide adequate customer service assistance, timely flight status notifications, and refunds in a prompt and proper manner.

Moving forward, the DoT has ordered Southwest to set aside $90 million in vouchers to cover similar events in the future. TechRadar Pro has asked Southwest Airlines for a comment on the latest fine, but we did not receive an immediate response.

More from TechRadar Pro

Craig Hale

With several years’ experience freelancing in tech and automotive circles, Craig’s specific interests lie in technology that is designed to better our lives, including AI and ML, productivity aids, and smart fitness. He is also passionate about cars and the decarbonisation of personal transportation. As an avid bargain-hunter, you can be sure that any deal Craig finds is top value!