Southwest Airlines insists its hallmark “bags fly free” policy is not on the chopping block, even as the carrier prepares to unveil scores of details in the coming days about sweeping changes to some of its longest-standing policies.
Next week, executives at the Dallas-based carrier are expected to delve into the specifics of a massive commercial overhaul revealed this summer — one that will see Southwest end its hallmark open-seating policy and add extra-legroom seats for the first time.
Exactly when will assigned seating hit Southwest booking channels? What will its unique boarding process look like in this new era? How many new extra-legroom seats will be on Southwest planes in the future — and what type of access will A-List elite status members get?
We should know it all soon: Company leaders in July promised to detail the nuts and bolts of the changes when they hold their annual meeting with investors.
That meeting is set for next week, and is sure to be of the utmost interest for airline industry insiders and frequent Southwest flyers alike.
Speaking to analysts in July, CEO Bob Jordan was frank about the scope of the changes planned for the company as it aims to boost its lagging financials.
“You’ve got to be willing to challenge everything that’s not fundamental to you as an airline,” Jordan said.
But that hard look at the business has also fueled plenty of speculation over the airline’s popular free-baggage policy, even as executives insist it’s here to stay.
Speculation swirls over ‘bags fly free’
After Southwest announced the end of its 50-year-old open-seating policy in July, droves of TPG readers commented on the story on our Facebook page, with some speculating that new add-on fees for luggage might be the next proverbial “shoe to drop.”
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“Soon they will start charging for bags,” one reader predicted.
Longtime aviation journalist and self-proclaimed Southwest loyalist Benét J. Wilson offered her own take in an op-ed penned in the wake of the airline’s announcement about assigned seating.
“At this point it feels like anything is possible,” Wilson wrote. “Only time will tell what the carrier’s evolution will look like and what it will become.”
Southwest: No bag fees in the works
To be clear, Southwest executives were adamant in July: No bag fees are in the works.
In fact, free bags are among the top three reasons customs choose Southwest, Jordan told analysts, contrasting the airline’s lenient policy with the widespread (and rising) checked bag fees at its competitors — some of which also charge customers for full-size carry-on bags on certain tickets.
Yet, in August, a Bloomberg report said the carrier started surveying customers on their appetite for paid bags, reigniting speculation.
Then, this month, the company went through additional upheaval when leadership made concessions to a group of activist investors who took a stake in the company earlier this year, demanding changes to boost Southwest’s financial performance.
Even today, though, the carrier is steadfast: No baggage policy changes are on the horizon.
“There’s no work currently underway to change our industry-leading two bags fly free policy,” a Southwest spokesperson told TPG Tuesday, noting the company regularly tracks customer sentiment “on many aspects” of its business “to ensure we remain competitive and current on the preferences of our customers.”
That much is no secret: Southwest is highly data-driven, having cited exhaustive customer surveys in touting its new seats planned for new jets starting in 2025 and, indeed, in deciding to make the shift away from open seating.
Even financial analysts don’t back bag fees
There’s good reason for Southwest to stick with free bags, too, financial analysts told TPG this week — and not just to keep customers happy in the short term.
“We believe bag fees will be viewed as a ‘value grab’ and erode Southwest’s brand,” said Savanthi Syth, industry analyst at Raymond James. “We don’t believe this is something Southwest should consider at this time.”
“I think that they should hold their powder on baggage,” concurred William Swelbar, chief industry analyst at Swelbar-Zhong consultancy. “I would much rather see them focus a lot on the product inside, whether it be the [seats], whether it be other ways to bundle services, that kind of thing, before they take the leap into baggage.”
Seat details (and more) expected soon
To Swelbar’s point, Southwest has plenty of big changes to talk about in the coming days, as it is.
Based on what executives said on July’s earnings call, we expect to soon learn details such as:
- The timeline for the rollout of assigned seating; this summer, executives only confirmed they’d start selling extra-legroom seats at some point in 2025.
- What the new boarding process will look like, and how similar it will be to the current “calm” process that, Jordan said, the carrier hopes to mimic to the greatest extent possible.
- How A-List status holders might benefit with boarding and seating perks under the new setup: “I think it’s safe to assume that there will be seating benefits that are associated with that,” Executive Vice President Ryan Green said in July.
- What the cabin layout will look like, and how many extra-legroom seats might be available on aircraft.
- Plans for the phasing-in of red-eye flights by summer 2025.
All of this is a big undertaking for an airline hoping to get back to the stellar financial performance that the carrier had been known for throughout most of its history.
“I don’t think this is outpatient surgery. I think this is inpatient,” Swelbar quipped. “And there’s a lot more work to do.”
In the meantime, if you’re flying with Southwest, you can still enjoy that free checked (and carry-on) bag. And it appears that should continue — for the foreseeable future, at least.
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