- A Bank of America analyst estimates Southwest's flight debacle will cost the airline up to $700 million, CNBC reports.
- The airline is currently offering affected passengers 25,000 frequent flier points valued at over $300.
As Southwest Airlines continues to address its costly holiday travel meltdown, qualifying passengers are being offered 25,000 frequent flier points in addition to refunds, reimbursements, and vouchers.
Passengers whose flights were disrupted between Dec. 24 and Jan. 2 received an email on Tuesday from Southwest CEO Bob Jordan apologizing for the airline's widespread flight cancellations and offering 25,000 Rapid Rewards points valued at over $300, the Wall Street Journal reported.
"On behalf of Southwest, I want to let you know we're so sorry," Jordan wrote in the letter. "I know that no amount of apologies can undo your experience."
It will cost Southwest more than frequent flier points to correct the mistakes made during December 2022, which left thousands stranded at airports over the holidays thanks to winter storms and the airline's outdated scheduling technology that thwarted staffing.
The company could end up paying between $600 million and $700 million, Bank of America airline stock analyst Andrew Didora told CNBC. The estimate includes both lost revenue from refunds and reimbursements for expenses like hotels and rental cars, CNBC reported.
According to Jordan's email, the points are being offered as a "gesture of goodwill" and are also available to passengers who requested a refund or travel reimbursement.
The Points Guy reporter Zach Griff tweeted on Tuesday that he was among those who received the email, noting that the points will come in addition to nearly $500 he already received in compensation in the form of refunds, reimbursements, and vouchers.
Although it's unclear exactly how many travelers experienced significant delays or cancellations during the meltdown, those hoping to claim points were put on a virtual waitlist on Tuesday due to a high volume of traffic, according to Griff.
—Zach Griff (@_ZachGriff) January 3, 2023
While Griff reported a 15-minute wait to receive points, another traveler told WSJ he had an estimated wait time of over an hour to redeem the 75,000 points offered to his party of three.
In the email, Jordan reminded recipients that Rapid Rewards points don't expire, have no blackout dates, and can be used on Southwest gift cards.