Southwest grapples with new labour and revenue problems

DALLAS (AP) – Southwest Airlines is lashing out at the union representing its mechanics, suggesting that they may be grounding planes to gain leverage in stalled contract negotiations.

Separately, Southwest said on Wednesday that the partial shutdown of the Federal government will cost it USD60 million in lost revenue during the first quarter – far more than the airline’s previous estimate of a USD10 million to USD15 million.

Southwest said it has continued to see softer bookings that it blames on the shutdown, which ended officially on January 25. The earlier estimate covered the period through January 23.

Delta Air Lines stood by a January estimate that it figures to lose USD25 million in revenue from the shutdown. Other carriers have not provided estimates.

Southwest shares tumbled USD3.26, or 5.7 per cent, to close at USD54.41. Shares of American, United and Delta dipped about one per cent.

A Southwest Airlines jet moves on the runway as a person eats at a terminal restaurant at LaGuardia Airport in New York on January 25. – AP

On the labour front, Southwest is fighting the Aircraft Mechanics Fraternal Association (AMFA), which represents nearly 2,400 Southwest mechanics.

Chief Operating Officer Mike Van de Ven said Southwest saw an increase in aircraft being declared out of service on February 12, “just days after our last negotiations session with AMFA”. The surge, concentrated at a few bases, occurred even though there were no changes in the maintenance programmes, he said.

The airline issued an emergency order last Friday that requires mechanics to get a doctor’s note if they call in sick and gives Southwest the power to impose mandatory overtime. Mechanics who don’t comply could be fired.

The memo went initially to mechanics in Phoenix, Las Vegas, Houston and Orlando, Florida, and this week to those in Dallas. Still, delays and cancellations have persisted.

Southwest cancelled about 440 flights – 11 per cent of its schedule – by mid-afternoon on Wednesday, according to FlightAware. A spokeswoman said the majority were due to bad weather – a storm disrupted air travel in the East – but there were still “a high number” of aircraft sidelined for mechanical issues. Southwest cancelled about 200 flights on Tuesday, when weather was not a major factor.

Van de Ven said “AMFA has a history of work disruptions” – Southwest has two pending lawsuits against the union – and the airline will investigate the latest incident. He said Southwest was giving as much work as possible to third-party maintenance providers so Southwest mechanics can focus on issues that they have identified.

The union countered that Southwest is “scapegoating” mechanics, and it warned that the conflict “does not bode well” for safety at one of the nation’s biggest airlines.