Southwest Airlines is ditching open seating
New York (CNN) — Southwest Airlines is shifting to assigned seats for the first time in its history, a change that will allow the low-fare carrier to charge a premium for some of the seats on its planes.
The airline will also start offering overnight “red-eye” flights for the first time, which it said will improve the efficiency by increasing the use of its aircraft.
Southwest said customers were clamoring for these changes – when people switch to a competitor from Southwest, the company said the No. 1 reason the unhappy passengers cite is open seating. But the change will also help the company charge some passengers more for their tickets.
“The research is clear and indicates that 80% of Southwest customers, and 86% of potential customers, prefer an assigned seat,” said the airline in a statement. “By moving to an assigned seating model, Southwest expects to broaden its appeal and attract more flying from its current and future customers.”
Southwest did not give details about when the changes will go into effect, but it said it would be discussed further in September.
A tectonic shift
The airline had announced in April that it was looking at a change in its seating policy that has been in effect for its entire 50 year history. Southwest is under pressure from activist investors who have been pushing for changes in management and growth in profitability.
Southwest has long been known as a low-cost, low-fare carrier, but it has been facing competition from the three other major carriers, American, United and Delta, which get much of their revenue from charging more for premium seating. It also faces growing rivalries on the other end of the spectrum: ultra-low cost carriers, such as Spirit and Frontier, which offer bargain-priced seats for which customers have to pay extra for just about anything including carry on bags.
Southwest doesn’t charge for carry on bags and has long allowed passengers to check two bags for free. The airline also doesn’t charge customers to change flights.
The company made no mention in its statement about whether it will change its baggage or change fee policy. The premium seats, which will offer more legroom, will not be available until 2025 as it will require reconfiguring its planes.
Southwest announced in April that it would be cutting flights from Indianapolis to four destinations, Cozumel International Airport in Mexico and George Bush Intercontinental Airport in Houston. The company blamed the decision on a first-quarter loss of $231 million and a delayed delivery of Boeing 737 Max 8 planes.
This is a developing story, it will be updated.