Southwest Airlines has detailed substantial changes to its business model and boarding process, introducing reserved seating. However, these changes will not be immediate.
The transition away from open seating is scheduled to begin in late 2025, with reserved seating expected to be available on flights by early 2026.
Southwest Airlines, known for its open seating policy for 53 years, announced plans to introduce reserved seating. This significant change will allow passengers to book specific seats starting in late 2025, with the reserved seats available from early 2026.
The shift comes as the airline aims to meet the preferences of 80% of its customers who desire assigned seating.
One factor contributing to the delayed implementation of reserved seating is the time required to reconfigure planes for premium seating. Despite the delay, reserved seating is already common across other airlines and could technically be implemented sooner.
Southwest has emphasised that the decision was part of an existing plan, not solely due to pressure from Elliott Investment Management, an activist shareholder group demanding changes to improve profitability.
Southwest will introduce premium seating, offering more legroom. However, details about the exact launch date for premium seating have not been disclosed.
CEO Robert Jordan previously mentioned that the sale of assigned seating would commence in 2025. This change will cater to a broader range of passenger preferences, potentially increasing customer satisfaction.
It remains to be seen how this shift will impact the airline’s business strategy and profitability.
The airline announced it will start partnerships with international airlines. First, Icelandair, starting next year, will connect through Baltimore-Washington International Airport.
Southwest aims to offer more international flight options, competing with rivals like American, United, and Delta, which have significantly more international destinations.
Southwest confirmed it will continue allowing passengers to check two bags for free. Most other U.S. airlines charge for checked baggage, contributing to billions in revenue.
CEO Jordan noted that charging for bags could slow boarding times as passengers look for space for carry-ons. The free baggage policy is seen as a key factor driving customer choice.
As part of its plan to boost profitability, Southwest aims to enhance aircraft turnaround times. Speeding up the process when planes are on the ground could lead to more efficient operations.
The airline believes that maintaining its current baggage policy will support quicker turnaround times, thus reinforcing its operational efficiencies.
Southwest’s strategic adjustments reflect its commitment to balancing customer satisfaction with business goals.
Southwest revealed a $2.5 billion share repurchase program, announced during an investors’ day presentation.
Company shares rose more than 6% in premarket trading following the announcement, signalling investor optimism.
The repurchase plan underscores Southwest’s confidence in its financial health and future prospects.
Overall, Southwest Airlines is making bold changes, though passengers will have to wait until early 2026 to experience reserved seating.
The strategic decisions regarding new seat configurations, international partnerships, and maintaining favourable policies like free checked bags indicate a balanced focus on customer preferences and profitability.
