Southwest Airlines Flight Nightmares Lead to DROP in Stock Value

Traveling during a holiday can be stressful enough on its own — with big crowds, high prices, concerns about what presents to get your family and friends, and more.

But when you add freezing temperatures, an arctic blast, delays, and cancelations to the mix, you’ve got a true recipe for disaster. Thousands of flights were delayed over the holiday weekend in 2022, but many airlines soon began to recover. Southwest Airlines, however, has continued to experience massive issues, and now its stock is feeling the impact.

On Monday, December 26th, Southwest Airlines canceled OVER 60% of its flights. But it didn’t stop there. On December 27th, by around 1:30PM ET, Southwest had canceled around 63% of its flights for the day. Staffing issues, weather delays, and other issues have all been cited in explaining these cancelations.

The next closest airline was China Eastern with HALF as many cancelations. Airlines like Spirit and United were much lower on the list with only 11% and 2% cancelations, respectively (according to FlightAware).

According to FlightAware, nearly 3,000 flights within, into, or out of the U.S. have been canceled on December 27th. A large percentage of those were Southwest Flights.

And this is just the beginning. All Southwest flights out of LAX, Hollywood Burbank Airport, Ontario International Airport, and the John Wayne Airport have been listed as “unavailable” until New Year’s Eve. Something similar has happened at San Diego International Airport as well.

Reportedly, Southwest made similar announcements at Orlando International Airport too, telling customers they won’t be rebooked until December 31st at the earliest.

Now, the cancelations have started to impact Southwest’s stock values. As of December 27th, Southwest stock was trading at around $34.30.

The stock was valued at around $36.09 on Friday, December 23rd. But after the thousands of cancelations over the holiday weekend, you can see the values decline. By December 27th at 9:30AM the stock had dropped from the $36 value to closer to $34.

The difference is really just a matter of a few dollars, but it still is a rapid decline.

Looking at the stock in terms of the last 6 months, it did reach a lower point back in September, when the stock was nearly $30.

Just how much more will the stock values drop? Only time will tell. But considering the number of cancelations that have already taken place, the cancelations that will continue over the next several days, and the thousands of passengers who have been left “stranded” in cities and airports throughout the U.S., stock values could continue to be impacted for a while.

In speaking with the Wall Street Journal, Southwest CEO Bob Jordan said “This is the largest-scale event that I’ve ever seen.” Jordan explained that Southwest was planning to operate slightly over 1/3 of its typical schedule in the upcoming days to “give itself leeway for crews to get into the right positions.” And the reduced schedule could be extended.

We’ll keep an eye out for more updates and let you know what we see. If your flight gets canceled and you’re wondering what Disney World’s cancelation policies are like, click here for the rules you need to know.

Stay tuned for more news.