January 30, 2020 / 5:25 PM / 6 months ago

Southwest disputes U.S. government audit on safety lapses, shares slide

WASHINGTON (Reuters) - Southwest Airlines (LUV.N) on Thursday disputed a draft U.S. government audit finding that the U.S. carrier failed to prioritize safety by flying millions of passengers on used jets without confirmation that required maintenance had been completed.

FILE PHOTO: A number of grounded Southwest Airlines Boeing 737 MAX 8 aircraft are shown parked at Victorville Airport in Victorville, California, U.S., March 26, 2019. REUTERS/Mike Blake/File Photo

Southwest shares closed down 1.9%, hit by concerns about the coronavirus outbreak along with the findings of the U.S. Department of Transportation, reported by the Wall Street Journal, which also criticized the FAA’s oversight of the airline’s safety procedures.

“We have communicated our disappointment in the draft audit report to the Office of Inspector General and will continue to communicate any concerns directly with its office,” Southwest said in a statement. “Any implication that we would tolerate a relaxing of standards is absolutely unfounded.”

The report said Southwest flew more than 17 million passengers over two years on planes with unconfirmed maintenance documentation on numerous Boeing 737 planes it had acquired from foreign carriers, the newspaper reported.

The FAA said late Thursday in a statement that after “learning of concerns about how certain aircraft were added to Southwest Airlines’ fleet, the agency took comprehensive action. In addition to actions aimed at ensuring the safety of the aircraft, the FAA appointed a new leadership team” at the FAA office that oversees Southwest.

The report said also that in 2019, a Southwest jet smashed both wingtips on a runway while repeatedly trying to land amid gale-force winds.

Southwest said Thursday that all of the 88 Boeing (BA.N) 737 used planes cited in the inspector general’s report “have either completed a comprehensive physical inspection, from nose to tail, or are currently in the inspection phase.”

Southwest said it “has completed a thorough review of 75 aircraft and we are in the process of inspecting the remaining 13 aircraft which are currently in heavy checks.”

Southwest said some repairs by prior owners “had been performed but not properly classified by the previous owners due to differences in language and repair criteria.” The FAA said in November that inspections of 39 used planes turned up previously undisclosed repairs and incorrectly completed fixes.

The inspector general is awaiting the FAA’s written response to the draft report and anticipates releasing the report within a few weeks, an official briefed on the matter told Reuters.

The planes were bought between 2013 and 2017 from 16 foreign carriers.

Southwest’s chief executive, Gary Kelly, met with Inspector General Calvin Scovel in September at the airline’s request as the audit investigation was under way, the official confirmed.

Reporting by David Shepardson in Washington; Additional reporting by Ankit Ajmera in Bengaluru; Editing by David Gregorio and Leslie Adler

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