Southwest Airlines To Introduce Checked Baggage Fees

Southwest Airlines

27.53 CHF 9.81%

• Charts
• News
• Analysen

Kaufen Verkaufen

(RTTNews) - Southwest Airlines is ending one of its most recognizable perks by introducing fees for checked baggage. Starting May 28, the airline will charge passengers for their first and second checked bags, the company announced Tuesday.

Business Select travelers, A-List loyalty members, and Southwest credit card holders will be exempt from these fees.

This policy shift marks a significant departure from Southwest's long-standing customer-friendly approach. Since its founding nearly 60 years ago, the airline has maintained its "bags fly free" policy, even as competitors adopted baggage fees.

CEO Bob Jordan acknowledged the change is part of a broader strategy to enhance profitability and attract new customer segments. Although he previously stated the airline had no plans to charge for bags, increased competition on third-party booking sites like Google Flights revealed that customers prioritize ticket prices over baggage benefits.

Southwest has not disclosed the exact fees for checked bags, but the move is expected to generate substantial revenue. The airline processes two to three times more checked luggage than its competitors and collected $73 million in baggage fees in 2023 despite offering free checked bags.

In comparison, American Airlines earned $1.4 billion, United Airlines $1.2 billion, and Delta Air Lines $985 million from baggage fees last year.

The baggage policy is part of a broader transformation at Southwest following Elliott Investment Management's $1.9 billion stake in the airline. Other recent changes include the introduction of assigned seating, premium cabins, and basic economy fares with stricter limitations.

While the new fees may frustrate loyal customers, analysts suggest Southwest's competitive pricing could mitigate significant passenger losses. Meanwhile, rivals like Delta and United see the shift as an opportunity to capture customers who previously chose Southwest for its baggage policy.