US govt waives part of Southwest Airlines' $140 million Biden-era fine

In an incredible push to facilitate airlines, the US Department of Transportation (DOT) has waived part of a Biden-era fine on Southwest Airlines after the airline cancelled thousands of flights during a winter storm in December 2022.

Under a settlement that took place in 2023, Southwest initially agreed to a $140 million civil penalty, the largest fine ever imposed on an airline for consumer protection violations.

While most of the penalty was directed toward compensation for affected travellers, Southwest was required to pay $35 million to the U.S. Treasury.

The airline made two payments of $12 million each in 2024 and earlier this year. Recently, the DOT waived the final $11 million sum, originally due on January 31, 2026.

The department acknowledged Southwest's significant improvements in on-time performance and investments in network operations. "This approach incentivises airlines to invest in improving their operations and resiliency, which benefits consumers directly," the DOT stated.

The fine stemmed from the airline's operational meltdown, resulting in the cancellation of 17,000 flights and stranding over 2 million travellers.

The Biden administration had determined that Southwest Airlines violated consumer protection laws by failing to assist stranded customers adequately.

The renowned U.S. airline expressed gratitude to the DOT for recognising its operational improvements, noting that it has achieved industry-leading performance and reduced cancellations following its operational underperformance over the past two years.