Andrew Watterson0:10
The disruption during the last week of December has garnered a tremendous amount of attention, so I appreciate the opportunity to testify on behalf of the company regarding airline operations and consumer protections. I want to sincerely and humbly apologize to those impacted by the disruption. It caused a tremendous amount of anguish, inconvenience, and missed opportunities for our customers and our employees during a time of year when people want to gather with their families and avoid stressful situations. We understand that for many, this is perhaps the most important trip they take all year. Again, on behalf of Southwest Airlines, I'm deeply sorry. Still, we've been mindful that an apology alone, no matter how heartfelt or how often stated, would not suffice. We immediately recognized we had to take care of our customers, and with regards to the disruption, we did so in a variety of ways: tickets on other airlines and other necessary expenses like replacement car seats and strollers and pet sitting services. We promptly processed refunds requested by customers for unused airfare for any Southwest flight canceled or severely disrupted during this period. We prioritized returning the bags to their proper owners. I'm pleased to report, except for a small percentage of recent requests, we've completed all those steps. It has truly been an all-hands-on-deck effort, and our people will not let up until the requests are completed. We also made an additional gesture of goodwill of 25,000 Rapid Rewards points, roughly a $300 value, to every customer significantly impacted by the disruption. So why did this happen? Let me be clear: we messed up, and I would like to explain to you how we messed up. In Chicago, where 25 percent of our flight crews are based, the weather caused our crews to be displaced. At this point, the disruption changed from a weather event that all airlines experienced to a crew event that was unique to us. And once again, when I say crew event, it has nothing to do with the behavior of our employees; it's to do with how we manage the crew network. As the storm moved east, other Southwest airports of all sizes in the central and eastern part of the country began experiencing similar operational disruptions, and the cascade of challenges led to waves of cancellations within two hours of departure. This overwhelmed our crew scheduling processes and technology. We had upgraded this system earlier in the year, but we were taking a fresh look at it and other systems to see how we should improve. Ultimately, none of this is an excuse. We need to make sure our operational resiliency and technology are improved. We strengthened our scheduling software, we strengthened our early indicators dashboard to escalate operational issues earlier, and we established supplemental operational staffing that can quickly mobilize to support crew recovery efforts. And we implemented organizational changes designed to improve coordination among key divisions. We also are already several weeks underway on improving our structural capabilities around our winter operations. Finally, Southwest has taken additional steps to more thoroughly analyze the disruption and understand how the accumulation of events led us to the end result, from internal department reviews to engagement by our board of directors and commissioning a rigorous third-party assessment. Based on all this work, we will then reassess our current plans and make any necessary changes. We will invest what's needed to execute that plan in a timely manner. And over our 52-year history, I will certainly follow up with your constituents, Chair, when I return to Dallas. I thank you, and I look forward to answering your questions.
