Southwest Airlines Bookings Are Down After April’s Fatal Accident

Southwest Airlines is still reeling from the impact of April’s accident, according to its latest earnings forecast.  In fact, the carrier has scaled back its more optimistic outlook for the rest of the year, and has said it will grow its capacity by 6 percent, down from the previous 7 percent target.   

Southwest also said it expects that its revenue per mile flown would drop by about 3 percent for the second quarter, which it said was a result of passengers booking away following the accident aboard Flight 1380,  in which an engine exploded, killing one passenger and injuring several others aboard.  

The company acknowledged that its suspension of its normal marketing and advertising activities following the accident had a significant impact. Traditionally airlines halt any promotional programs after such a tragedy, but in this case, the situation was exacerbated by the continued media coverage of the details of the event:  shrapnel from the engine punctured a window, and the resulting depressurization of the cabin sucked a woman adjacent to that window out of the plane. While she was pulled back into her seat by fellow passengers and crew, she later died from her injuries.

A full investigation of the accident by the National Transportation Safety Board will likely take a year to complete, but in the meantime, Southwest has completed a federally mandated inspection of all engines of the same type that exploded in Flight 1380, in order to look for signs of metal fatigue.  Southwest said that all engines in its fleet have been given a clean bill of health.

Southwest said that the safety issue is just one of several factors dimming the outlook for the rest of 2018; higher oil prices are also raising concerns for all airlines.