Southwest Airlines has changed its terms and conditions and is eliminating expiration of points, raising the requirements for the Companion Pass, and announcing that starting in 2021 they’ll collect any changes in TSA fees and airport facilities charges when elites use free standby.
- Effective January 1, 2020 the points required for Companion Pass will rise from 110,000 to 125,000. That’s a 14% increase, and follows a change three years ago where points transfers from hotel and rental car programs no longer count.
I just applied for a Southwest credit card with plans to earn the initial bonus at the start of 2020. That plan still works – I’ll just need to earn 15,000 more points than I had expected.
- Effective today Southwest Rapid Rewards points no longer expire. They had previously had a 24 month expiration policy. This change follows United’s move from the end of August to join Delta and JetBlue in not expiring miles.
- Effective January 1, 2021 when elites stand by for an earlier flight they’ll be charged any difference in taxes and airport fees. If TSA screening fees go up between the time of ticket purchase and date of travel, those increases will be passed on to the passenger changing their flight. If airport ‘passenger facility charges’ go up, those will be passed on as well.
These are edge cases, but there are moves for both to go up and some elites could be asked to pay a few dollars when they stand by.
While elimination of expiring months is actually a negative for engaged members of SkyMiles and MileagePlus (more competition for saver award seats) that’s really not an issue for Southwest with its straight revenue-based redemptions. Ending points expiration is unambiguously positive. This is a costly move for Southwest to make since it means no longer being able to recognize revenue from breakage and reduce their points liability.
Passing on PFC and security tax increases to elites using their ‘free standby’ benefit seems petty but could add up across all customers making changes, if airports successfully lobby to be able to increase the maximum charges allowable and security screening taxes are somewhere Congress goes for revenue.
In some measure then, these two changes taken together represent elite frequent flyers partially funding the new no-expiration benefit for general members.
The Companion Pass change though is the biggest news and most disappointing, though Companion Pass will remain one of the best deals in travel even with the 125,000 point per year requirement. The value of the Companion Pass is head and shoulders above what competitors offer, and in some ways I’ve been surprised that it’s persisted at all, so even if disappointing changes here are hardly surprising.