Southwest Airways is making main modifications to its long-standing insurance policies, together with eliminating one among its most well-known perks—free checked baggage.
This shift comes after the airline additionally introduced modifications to its seating insurance policies, ticket gross sales, and general enterprise technique. Right here’s every part it’s good to find out about what’s altering and the way it would possibly influence vacationers.
1. Southwest Will Begin Charging for Checked Baggage
For practically 60 years, Southwest has supplied two free checked luggage per passenger—a coverage that set it other than opponents. Nonetheless, beginning Could 28, the airline will start charging for checked luggage.
- A-Checklist loyalty members and enterprise fare vacationers will nonetheless obtain free checked luggage.
- Southwest has not but introduced particular pricing for luggage charges.
2. Why Southwest Is Making the Change
Southwest CEO Bob Jordan cited the necessity to appeal to new buyer segments and enhance profitability. The airline is trying to align with trade requirements, as most main airways have lengthy charged for checked baggage.
Regardless of its earlier “Baggage Fly Free” coverage, Southwest nonetheless collected $73 million in baggage charges in 2023, primarily from obese or extra baggage charges. Nonetheless, this quantity pales compared to opponents like American Airways, which raked in $1.4 billion in baggage charges final 12 months.
3. Rivals See an Alternative
With Southwest eliminating free checked luggage, some vacationers could change airways. Delta CEO Ed Bastian famous that passengers who particularly selected Southwest for its baggage coverage are actually “up for grabs.”
Shares of Southwest (LUV) jumped 9% in premarket buying and selling following the announcement, indicating investor confidence within the transfer.
4. Different Main Adjustments Coming to Southwest
Along with baggage charges, Southwest has made a number of key modifications:
- Assigned Seating: The airline will finish its open seating coverage by early 2026.
- Premium Seating: Southwest will introduce premium seating choices, aligning with different main airways.
- Fundamental Financial system Fares: Beginning in Could, Southwest will provide lower-priced tickets with extra restrictions.
- Promoting Tickets on Expedia: For the primary time, Southwest flights will probably be out there on third-party platforms.
- Pink-Eye Flights: The airline just lately launched in a single day flights to develop scheduling choices.
5. Mass Layoffs & Management Adjustments
In January, Southwest laid off 1,750 workers, marking the primary mass layoffs in its historical past. These cuts are anticipated to avoid wasting the airline $210 million in 2024 and $300 million in 2026.
Moreover, the corporate has undergone management modifications:
- New CFO Tom Doxey (previously with Breeze Airways) took over this 12 months.
- Former CFO Tammy Romo and Chief Admin Officer Linda Rutherford will retire in April.
What This Means for Vacationers
Southwest’s modifications mark a shift towards a extra conventional airline mannequin. Whereas some prospects could welcome assigned seating and premium choices, others could also be pissed off by baggage charges and primary financial system restrictions.
Southwest Airways Is Dropping Free Checked Baggage—What You Must Know
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