Southwest Airlines Co. (LUV) under FAA probe over baggage weight

NYSE: LUV | Southwest Airlines Company Common Stock News, Ratings, and Charts

LUV – The Trump administration is probing whether Southwest Airlines Co. miscalculated the weight of checked luggage on its flights.

The Trump administration is probing whether Southwest Airlines Co. miscalculated the weight of checked luggage on its flights.

The investigation by the Federal Aviation Administration – first reported by the Wall Street Journal and confirmed to Fox Business by an agency spokesperson – centers on the process the Dallas-based airline uses to determine the overall weight of baggage stored in the belly of its jets.

“In February 2018, the FAA initiated an investigation against Southwest Airlines regarding weight and balance performance data. Since that time, the FAA has directed the development of a comprehensive solution to the methods and processes used by Southwest Airlines to determine this performance data,” an FAA spokesman said in an emailed statement.

“The FAA will not close its investigation until it is satisfied that Southwest’s corrective actions are consistent and sustained,” he added.

A Southwest spokeswoman said the ongoing communication with the FAA is part of “an effort to track and voluntarily report operational data” to “mitigate and eliminate any operational risks.”

“Despite reports, there is no enforcement action against Southwest Airlines regarding our weight and balance program,” she said in an emailed statement. “Southwest believes the controls and procedures we implemented throughout 2018 have enhanced our weight and balance program and resolved the issues that we originally reported to the FAA.”

The carrier has asked the agency to close the investigation.

Airlines use average weight to determine the overall load for checked bags on a certain flight. But while other U.S. carriers like American Airline and Delta Air Lines use scanners to tally up luggage as it is loaded onto the aircraft, Southwest currently relies on its ground crew to count the bags.

While the company says its system poses minor risk to passengers, some FAA inspectors reportedly charge that the potentially one-third of Southwest’s nearly 4,000 daily flights with inaccurate weight information could threaten safety in the event of engine failure or other issues.

Southwest says there is no current information to support that estimate.

The company is soon preparing to computerize their system, first in Seattle, San Diego and Sacramento, according to a letter from one of its senior officials to the FAA obtained by the Journal.

Unlike some of its competitors, Southwest does not charge for checked luggage – bucking an industry trend to increase the cost of so-called ancillary benefits to recoup for losses elsewhere, like high fuel prices.

Southwest Airlines Co. shares closed at $57.70 on Friday, down $-0.30 (-0.52%). Year-to-date, LUV has gained 24.14%, versus a 10.98% rise in the benchmark S&P 500 index during the same period.

LUV currently has a POWR Rating of B (Buy), and is ranked #3 of 21 stocks in the Airlines category.

This article is brought to you courtesy of Yahoo Finance.

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