Southwest Airlines is making a significant change. Starting May 28, they will no longer offer free checked baggage. This shift affects everyone except those with certain perks. Members of the A-List loyalty program, holders of the airline's branded credit card, or those on business fares can still check bags for free. This move is a big deal because Southwest has always been known for its "bags fly free" policy. It's been a major selling point for the airline for decades. The decision comes after Southwest started selling tickets through third-party sites. This showed that customers were more interested in price than in generous policies.

        The change was also influenced by new executives from other airlines. These executives already charge for bags, and their presence at Southwest has validated the shift. Southwest's CEO, Bob Jordan, said that these changes are exactly what employees want. It's a bold move, but it's not unprecedented in the industry. Southwest is trying to boost its bottom line. The airline has two to three times as many checked bags as other airlines. This means that even a small fee could bring in significant revenue.

        Southwest isn't the only airline to collect baggage fees. In 2023, American Airlines collected $1. 4 billion, United Airlines pulled in $1. 2 billion, and Delta Air Lines garnered $985 million. Southwest, on the other hand, collected $73 million in 2023 and $62 million in the first 9 months of 2024. This is a small fraction of what other airlines collect, but it's still a significant amount.

        The airline has made several changes recently. These include introducing assigned seating, premium seats, and red-eye flights. These changes are in line with traditional carriers and are meant to boost profitability. The airline has also started selling tickets on Expedia and will introduce "basic economy" fares in May. These are low-priced tickets with many restrictions. The airline is trying to attract more customers and boost its bottom line.

        Southwest has also cut 15% of its corporate workforce, or 1, 750 people. This is the first mass layoff in the company's history. The layoffs will save the company $210 million this year and $300 million in 2026. The company started the year with a new chief financial officer, Tom Doxey. Southwest's previous chief financial officer, Tammy Romo, and chief administration officer, Linda Rutherford, will retire in April.

        This change could alienate some customers. However, other major airlines already have fees. As long as Southwest maintains competitive pricing, it's unlikely to see a significant loss of customers. Competitors are already seeing this as an opportunity to gain customers. Delta CEO Ed Bastian and United CEO Scott Kirby both predicted that other airlines, including their own, are likely to see gains because of Southwest's decision.

        The airline is trying to meet current and future customer needs. It's also trying to attract new customer segments and return to profitability. The changes are a big deal, but they are not new to the industry. The airline is trying to boost its bottom line and attract more customers. It's a bold move, but it's not unprecedented in the industry.

Southwest's Big Bag Change: What It Means for Flyers

Actions