Southwest slows pandemic recovery amid operational and staffing issues

Southwest is backing off plans for a quick recovery following a series of operational challenges that culminated in a meltdown that saw nearly 2,000 flights cancelled earlier this month. The carrier has cut Q4 capacity by 3 points to down roughly 8% versus 2019, and executives expect these reductions to continue well into 2022 as the airline focuses on operational integrity and staffing issues. The slowest to return will be markets historically strong with business travelers that saw their deep, multi-flight schedules pruned dramatically as Southwest pivoted to offering more leisure-oriented breadth over depth during the Covid-19 crisis. Headline capacity will return to 2019 levels next year but that depth — and possibly the return of lucrative corporate road warriors — that will take longer. “2022 will be another transition year in the pandemic recovery,” said incoming Southwest CEO Bob Jordan during the airline’s Q3 earnings call on Thursday. “The restoration of the network is a top priority in ’22 and ’23, but it will take time and it will be largely dependent on the pace of recovery of business travel and our ability to staff.” Business demand at Southwest was down roughly 73% compared with two years ago at the end of September, said CCO Andrew Watterson. This was a drop from down roughly 60% in July and August, and where the carrier hopes to end the year at. For comparison, American Airlines and Delta Air Lines both said business demand was at roughly half of 2019 levels — or nearly 20 points above Southwest — in September. And Alaska Airlines, American and United Airlines all plan to be back to or nearly to 2019 levels next year.<br/>