US waives final $11m Southwest Airlines fine for 2022 travel meltdown
December 8, 2025
The US Department of Transportation (DOT) has dropped a final $11 million penalty against Southwest Airlines, concluding a high-profile enforcement action tied to the carrier’s operational collapse during the 2022 holiday travel period.
The fine formed part of a $140m settlement agreed in late 2023, after Southwest’s scheduling systems buckled under severe winter weather and cascading delays, leaving more than two million travellers stranded and forcing a mass cancellation of flights.
The disruption saw more than 15,000 flights canceled across the US.
Costly meltdown for Southwest Airlines
The airline accepted a $35m penalty payable to the US Treasury, with the rest going to passengers in the form of travel credits valued at $75 or more.
Southwest has since embarked on a broad overhaul of its operations, committing more than $1bn to improve stability, including upgrades to crew scheduling and its network operations.
The DOT cited that investment, and the results it says are now visible in the airline’s performance data, as the basis for wiping out the remaining payment.
In the amended enforcement order, the department said it was modifying the original penalty schedule laid down in December 2023, which required Southwest to pay “$35 million to the U.S. Treasury in three installments – two installments of $12 million and one installment of $11 million.” It confirmed the airline had made both $12m payments as scheduled, and that the final $11m had been due next year.
Recognising Southwest’s investment in operational resilience
Instead of collecting that final sum, the DOT granted Southwest an $11m credit tied to the airline’s investment in its Network Operations Control facility.
The order states: “In lieu of a payment of an $11 million civil penalty to the government, this order provides Southwest with an $11 million credit for significantly improving its on-time performance and completion factor through its $112.4 million investment in its Network Operations Control (NOC).
“DOT believes that this approach is in the public interest as it incentivises airlines to invest in improving their operations and resiliency, which benefits consumers directly.”
The decision highlights a shift in regulatory tone. Rather than simply extracting a penalty, the DOT argues that passengers see greater benefit from improved operational resilience, such as higher completion rates and on-time arrivals, than from putting the money into Treasury funds.
For Southwest, the waiver marks the end of a bruising chapter.
The 2022 disruption exposed weaknesses in its systems and drew intense scrutiny from regulators, politicians and passengers.
“There’ll be lessons learned from this and we’ll continue to make more investments,” said Southwest Airlines’ CEO, Bob Jordan, at the time.
Featured image: Southwest Airlines
