National Consumer News

Delta outage price tag: $100 million


Kelly Yamanouchi

The Atlanta Journal-Constitution

Delta Air Lines says the August computer outage that led to thousands of flight cancellations cost the company about $100 million in lost revenue.

The Atlanta-based airline, whose annual revenue is about $40 billion, included the estimate in a monthly performance report Friday. The amount includes both cancellations — about 2,300 over four days — and recovery efforts, Delta said.

Delta offered $200 travel vouchers to passengers whose flights were canceled or delayed for more than three hours during the outage, but it hasn’t said how many have sought the vouchers.

The outage meant lost revenue and increased labor costs for overtime and rebooking, analysts noted. For example, many crew members “timed out,” or exceeded federal duty time limits, while waiting for delayed flights, and were displaced.

Travelers faced their own costs: missed business meetings, work days, vacations, weddings and funerals, and for some the cost of hotel stays and food while delayed.

In the monthly report Delta said the episode boosted cancellations in August to 2 percent of all flights, vs. 0.2 percent in the same month a year earlier. On-time performance also suffered, dropping to 79.9 percent from 85.5 percent a year earlier.

The airline said unit revenue declined 9.5 percent in August compared with a year ago, due to lower last-minute fares, international competition and currency challenges.

Delta said the outage occurred after a hardware breakdown led to a power failure at an Atlanta facility. Some of the airline’s servers were not connected to backup power, preventing a smooth restart.


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