Instead of making those investments, Southwest distributed over $1.8 billion in dividends to its shareholders and bought back over $11 billion in its shares between 20.
Southwest airlines stock software#
Southwest has long known that its software was outdated, and the Southwest Airlines Pilots Association had warned that such a debacle was inevitable unless Southwest invested in new scheduling systems. If Southwest Airlines has not been investing in operational processes, scheduling technologies, or modernization, where have the airline’s profits been going? A letter sent earlier this year to Jordan, Southwest’s CEO, by 15 senators highlighted how the airline has used its cash flow to line the pockets of wealthy executives and shareholders with billions of dollars in stock buybacks and dividends instead of investing in the consumers’ experience, workers, and operations: The company lost where crews were because their system doesn’t have the infrastructure to support the type of operations that we run today. And it wasn’t the first time that flight attendants have slept on airport floors or had to deal with extremely irregular, chaotic operations. The Southwest meltdown was a terrible time. Speaking with Dollars & Sense, Lyn Montgomery, president of Transport Workers Union of America (TWU) Local 556, representing 19,000 Southwest flight attendants, explained:
As scheduling communication networks were overwhelmed past capacity, flight attendants reported being unable to contact Southwest to give or receive updates. Southwest’s meltdown not only left travelers stranded the airline also lost track of flight crew locations. Whether that’s Thanksgiving or Christmas or New Year’s, that’s the precarious situation we are in.” Only a month earlier, on a November 7, 2022, episode of The SWAPA Number podcast, Murray stated, “I fear that we are one thunderstorm, one air traffic control event, one IT router failure away from a complete meltdown. Unfortunately, those warnings were summarily ignored. Senate Committee on Commerce, Science, and Transportation, Casey Murray, president of the Southwest Airlines Pilot Association (SWAPA), explained that “our pilots have been sounding the alarm about SWA’s inadequate crew scheduling technology and outdated operational processes for years. However, representatives of flight attendants’ and pilots’ unions spoke out about other predicable and avoidable factors that caused the massive travel disruption. Initially, Southwest Airlines blamed weather and other factors outside of their control for the meltdown. Bob Jordan, who received a 75% pay increase in 2022 when he was promoted to the position of Southwest’s CEO, touted that the “announcement reflects the strong return in demand for air travel and the company’s solid operating and financial results since March 2022.” Less than two weeks later, Southwest Airlines spiraled into a disastrous operational meltdown, cancelling nearly 17,000 flights from December 20 through December 29, and leaving approximately 2 million passengers stranded during the holiday season. On December 7, 2022, Southwest Airlines announced that it would reinstate its quarterly dividend payments, which had been legislatively suspended under requirements in the Coronavirus Aid, Relief, and Economic Security Act (CARES Act).
0 kommentar(er)
