Southwest Airlines is making major changes to its policies and operations to boost profitability and stay competitive. Starting May 28, 2025, the airline will introduce checked bag fees, ending its long-standing “Bags Fly Free” policy. By early 2026, it will switch to assigned seating, offering premium seat options for an extra charge. A new basic economy fare with restrictions will also be introduced, and flight credits will now expire after one year. Additionally, the airline is cutting 1,750 corporate jobs (15% of its workforce) to reduce costs. Meanwhile, the FAA has increased safety oversight following recent flight incidents. These changes mark a significant shift in Southwest’s customer policies and business strategy.
Introduction of Checked Bag Fees
Starting May 28, 2025, Southwest Airlines will discontinue its longstanding “Bags fly free” policy. Passengers will
now be charged for checked bags, aligning Southwest with other main U.S.
carriers that generate substantial revenue from baggage
fees. Only specific groups, such as Rapid Rewards A-List Preferred Members, Business Select fare travelers, A-List Members,
and holders of Rapid Rewards credit cards, will continue to receive one or two free checked bags.
Implementation of Assigned Seating
In a move away from its traditional open seating policy, Southwest plans to introduce assigned seating during the first
half of 2026. This change is based on customer recompose, with surveys indicating that 80% of passengers prefer knowing their seat
assignment before arriving at the airport.
Additionally, the airline will designate approximately one-third of its seats as premium
options, offering up to five extra inches of legroom for an additional fee.
Introduction of Basic Economy Fares
Southwest is set to launch a basic economy fare, which will come with certain restrictions and limitations on refunds and changes. This fare option aims to attract price-sensitive travelers while allowing the airline to stand more effectively with other carriers offering similar fare structures.
Reintroduction of Expiry Dates on Flight Credits
The airline will also reintroduce expiration dates for flight credits. Credits issued for tickets purchased
after May 28, 2025, will be valid for one year.
This policy change is part of Southwest’s broader strategy to adjust to
market dynamics and improve financial performance.
Reduction in Corporate Workforce
In an unprecedented move, Southwest Airlines is eliminating 1,750 jobs, representing 15% of its corporate workforce. These cuts, focused on corporate overhead and leadership positions, aim to create a leaner organization and are expected to save approximately $210 million this year and $300 million in 2026.
Increased Regulatory Oversight
The Federal Aviation Administration (FAA) has increased its scrutiny of Southwest Airlines following a serie
s of incidents, including flights operating at rarely low altitudes and a takeoff from a closed runway.
While none of
these events resulted in injuries, the FAA’s heightened oversight underscores the importance of strict adherence to
safety regulations.
Conclusion
Southwest Airlines is undergoing significant transformations, shifting from some of its hallmark policies to adapt to current industry trends and financial pressures. These changes reflect the airline’s efforts to stay competitive and profitable in a rapidly evolving aviation landscape.