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Southwest’s Meltdown Could Cost It Up to $825 Million


The meltdown that forced Southwest Airlines to cancel more than 16,700 holiday flights could cost the carrier between $725 million and $825 million, the airline said in a filing on Friday. The total represents about as much as the airline earned in the first nine months of last year.The crisis shows what can go wrong when a company that millions of people rely on moves too slowly to invest in crucial but unglamorous parts of its operation. Southwest struggled to recover from frigid weather after its crew scheduling processes failed to keep up with flight cancellations and quickly reassign pilots and flight attendants.“A number of their employees, flight attendants and pilots, have been warning about this for years — that they were underinvesting and that they were one storm away from disaster,” said Helane Becker, a managing director and senior analyst at Cowen, an investment bank.Southwest said on Friday that it now expects to report a …

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