More layoffs are coming to Southwest Airlines. For the first time in company history, Southwest Airlines let go of 1,700 non-union employees at its headquarters. Employees were banned from corporate headquarters and firings took place online.
Now, in addition to major business changes like selling seat assignments and charging for checked bags, in a piece of the reduction of force not previously reported the airline is going to be outsourcing its skycap service. Currently 10 airports have Southwest employees assisting with curbside baggage. This ends in mid-May.
Dallas Love Field skycap employees and employees in Austin are talking about receiving their notice, and no doubt elsewhere. Reader Ellen shares her sad interaction with an employee on Monday evening: “One young lady said her father…got fired too…She said they will hire 3rd party staffers so they don’t have to pay benefits! some of these employees have been with southwest for a decade.”
According to a Southwest spokesperson,
From now through mid-May, we’ll continue to have 10 Southwest Employee-operated Skycaps in service. After that, all Skycaps will be vendor operated. The gap between notification and separation allows us to work on securing vendor service prior to mid-May and allows affected Employees the opportunity to apply with the vendor. Of the 52 Skycaps we currently operate, those 10 are the only locations not contractor serviced.
The airline is giving up its customer-focused and efficiency advantages over competitors, making itself more like those competitors with fees for everything while (1) offering an inferior product [no first class, no lounges, no seat back screens, no standard power outlets, lack of high speed wifi] and (2) without a fleet or route network that can compete for customers, which also means a frequent flyer program that doesn’t offer customers the breadth that attracts high co-brand spend.
In other words, they’re making themselves just like everyone else – but with a less attractive product and less ability to move passengers where they need to go.
So they need to find cost cuts. Headquarters layoffs seemed silly because they already had a hiring freeze, and in 12-18 months would have accomplished the same headcount reductions without resorting to creating a culture of fear at the company. I have heard from many working at the airline who wonder when the next round will come.
The airline clarifies that – though layoffs had been framed by the company as happening at headquarters rather than effecting the front-line – letting go of sky caps was part of the 1,700 total layoffs rather than in addition to it.
American Airlines outsourced curbside check-in at the few airports that still offer the service and now charges $3 – $4 per bag.
The lower-paid third party employees tend to be less helpful, and tell me that the per-bag fee trades off with tips (since customers are already paying for the service). That’s another path Southwest could take to generate ancillary fees in the future.
Asked whether charging for curbside check-in, like American Airlines does, is in Southwest’s plans their spokesperson said, “We can’t disclose any potential ancillary pricing, but we don’t currently charge at those 42 of 52 skycaps that are vendor operated.”
Elliot strikes again, don’t expect this to be the last cost cutting measure they do, everyone should be on guard.
I’ve never seen a free Skycap. Here are the fees at Toronto’s Pearson airport:
$25.00 for pre-arranged online booking, including a personalized sign with your name
Fixed rate of $20.00 for up to three check-in items
Additional bag rate: $3.00 per bag
Additional charge of $10.00 per pet cage or for any other equipment
Transfer fee of $10.00 to Carpark, Sheraton Gateway, ALT Hotel, or another terminal
I suspect that LUV will create hubs and eventually look like jetBlue. Small communities will lose service and the BIG 3 will benefit (likely AA the most). In 2-3 years, they will be in bankruptcy and re-organized into a LCC once again. Today, they are inefficient, expensive and the service isn’t what it was. Herb. . .sorry you have to watch this from above. . .what a joke your airlines as become.
Skycaps clear $100k a year tax free while hardworking untipped schoolteachers make $50k. That’s not an equilibrium in economic terms so it was either canning the skycaps or paying teachers more and we all know what happens when we try to pay teachers more: it doesn’t happen.
Hear me out: “Uber for luggage.”
Well I wrote the customer comments section of SW a condolence letter on the death of what was once a great corporate culture. Don’t expect a reply, but at least somebody saw that people care, and are sorry for what they are going through.
Nothing like damaging the brand by terminating long time curbside employees (who interact directly with your premium customers). Watch the customer engagement and satisfaction scores for SWA continue to drop.
These are typically Business or premium flyers…those willing to pay the fee and/or tip generously in return for efficiency. Another competitive advantage gone.
Southwest has what remaining competitive advantages and distinguishing features to keep it from having a stall and a nosedive? There used to be some routes where the airline had enough frequency to make it very useful for business travelers/commuters, but those routes/frequencies are no longer what they used to be and that market is also thinner than it used to be.
Maybe Southwest can make the same wild adventures as JetBlue and try routes to Europe too? Won’t fly, at least not in time for an FT Do with a cast of characters in October in Europe if Canada doesn’t fly.
What does nsx think of Southwest Europe service? I don’t think it will fly, at least not well for Southwest. But where will Southwest go from here? Go for a combination or partnership with JetBlue?
Southwest still has Skycaps? My goodness.
United got rid of those 35-odd years ago. They got low wages, but were the only employees permitted to accept tips, so they could make a good living, plus they got health care and pension benefits.
But UA was paying those benefit costs up against the PeopleExpress’s of the world who had no skycaps. People that wanted curbside bag check had to use independent skycaps hired by the airport.
So Southwest is not entering the 21st Century. They’re just catching up to the late 20th.
No bag fees AND skycaps? And supposedly a “low cost airline”?
again, how many other airlines eliminated these jobs a long time ago?
While WN is cutting another leg out of ITS model, other airlines have done the same thing and that process is now done at a charge or is outsourced
‘1,700’ people on a ‘whim’ sure is a lot people and their families who will be negatively impacted by these changes–this is what happens when you don’t have worker protections (non-union).
As Elliott continues to end everything different and good about this airline, never forget, it was all for their short term profits and the ‘golden parachutes’ for the top executives.
We should probably, maybe, like, sorta, perhaps…elect better folks who actually care about their constituents, the workers and consumers–not just ‘quick’ money from special interests.