Southwest Airlines doesn’t know who they are any longer, and doesn’t know what their core business is. They’re ‘just like the rest of the airlines, but not as good’ now that they charge for checked bags and seat assignments and expire their flight credits – but they have the worst inflight wifi, no standard power outlets, no seat back entertainment screens, and no ovens in their galleys to offer meals. There’s no first class, no lounges, and they’ve even taken an axe to the company’s famous culture through layoffs.
They said checked bag fees would generate $1.5 billion in revenue but cost them $1.8 billion in business. It turns out to be worse than that – in July they touted they’d achieve just $1 billion in revenue even as once-loyal customers abandon them.
So they’re flailing – they executives revamped the business model to save their jobs as Elliott Management took effective control of the board. And CEO in name only Bob Jordan says they’re now considering new planes, first class and lounges.
- Southwest is chasing whatever customers say they want whether it’s iPhones, donuts or European destinations.
We are going to continue to pursue the customer and provide the things that they want. We’ve got … millions of folks that love Southwest Airlines. They would love to fly us to Europe, as an example. 
- That could mean new planes, premium cabins, and airport lounges.
Southwest Airlines doesn’t have lounges… We don’t serve destinations beyond what the 737 [can] serve. We don’t have a true premium product… A first class. A business class.
- And the all Boeing 737 operator could go with Airbus A321XLRs for Europe, because those are cheaper to operate than widebodies and can fly further than the carrier’s 737 MAXs (that could operate to places like Iceland and Ireland).
Should we chose to fly to Europe… that’s not a mission the 737 Max will do, so we need a different aircraft…It could be that a widebody is just too much, at least for a start.
- But Jordan doesn’t actually know, because they’re quickly trying to figure out a future for an airline that’s become rudderless.
I’m not promising those things… Everything is on the table at Southwest.
Southwest now partners with Icelandair, China Airlines, and Eva Air. That’s a start, and something they should have done years ago – sell tickets to customers of airlines bringing passengers to the United States, and sell travel beyond their own destinations to their customers.
There’s a lot of change that’s been needed at Southwest. They probably maxed out their business model of one plane type, which limited them to flying to large-ish destinations close to the United States. They don’t have feed from smaller cities with regional partners or small planes (for markets that can’t support 737s) or to long haul destinations too far to reach with a 737. And they haven’t had the products people want to buy – they’re adding extra legroom seats but still won’t let you pay to block a middle seat. And they became top-heavy and underinvested in IT (hence their famous Christmas 2022 meltdown).
The problem is that this implies there’s no real opportunity to return to the kind of growth the airline saw in the past, and the kind of valuation multiples for their stock. There’s no great answer for Southwest, but their approach – to copy the business models of financial laggards JetBlue and American – isn’t promising.
Wishing them all the best with that… @Mike Hunt has been hoping for an actual SWA First Class; sounds nice to me. However, I doubt activist investor Elliott (mis)Management is going to want to fund all these improvements; rather, I expect little of this will come about, other than the hype. And, as @Tim Dunn and I have been talking, whenever it falls through, Delta’s read to swoop in, and acquire some assets!
How long before the executives start taking those golden parachutes?
This is turning into an HBR case study on what NOT to do.
Unfortunately, my Southwest long dated puts are still under water. Go figure.
Gary, are you sure Doug Parker (US Air) is the worst CEO? I think Bob Jorden (aka Elliot Management) and Jeff Smisek (Continental) are pretty close competition for the worst.
>Southwest is chasing whatever customers say they want
I want my Southwest Classic back.
Southworst has screwed themselves and their loyal customer base.
@Other Just Saying – I say it’s Doug Parker based on destruction of shareholder value. Elliott Management has not driven gains with their plan, but we can’t say they’ve evaporated tens of billions in equity. And Jeff Smisek, sure their billions in expense cuts were dubbed “Project Quality” in a particularly Orwellian manner and he resigned in disgrace in a corruption scandal, but he advanced “changes you’re going to like” so who can really fault him?
@hood – several top executives, like Ryan Green, Tammy Green, and Jonathan Clarkson have already left – frankly it’s what they *should* do (and what Jordan should have done, as well).
@Gary said:
“Southwest now partners with Icelandair, China Airlines, and Eva Air.”
Not going to help them. When I fly CI or BR, I’d never choose WN for my positioning flights now; it’s not that hard to book separate tickets on somebody else for those trips.
Once the changes went live, I cancelled my Southwest credit card and no longer pay any attention to WN.
WN said this morning that its baggage fees should deliver $350 million in additional revenues in 2025, far less than they originally forecast.
the next 2 quarters have to validate whether what WN is trying to change right now is working or there has to be a recognition that the plans were wrong.
WN has tried to chase a lot new in a short period of time; organizations and their customers can only move so fast, esp. given that the entire industry is still very competitive.
DL said this morning that it sees strong demand through the end of the year which means there is more “forgiveness” in poor business plans that there was earlier this year.
@Tim Dunn — I know it’s anecdotal, but I’m only booked through Q1 2025, then… nothing. Usually I’d have plans 10-12 months out; I’m scaling back. Wonder how widespread this may be. Tariffs. Wars. Troubles. Don’t worry, though, I’ll still use my DL Companion Certificates once I receive them. *wink*
@Gary: Ok Ok. I totally agree that Parker was really….really bad. I remember, he did an interview on CNBC Mad Money show some time ago. Most CEOs at least sound intelligent. Doug Parker sounded like a total dunce.
As much as I have always liked and respected Bob Jordan, having worked with him a couple of times briefly, I am thinking it is time for him to move on. My fear however, is that the Predator in Charge will further destroy what Herb Kelleher built. Frankly, Southwest needs to back peddle a bit and remember what made them great to begin with. That was the respect for all passengers, not just the entitled who Gary Kelly worshiped. They also need to re-evaluate their boarding process as it has become a disaster and has greatly encouraged the dishonest scammer population. When the call for pre-board says that if you can walk down the Jet Bridge, please line up now. If you cannot and are in a wheelchair we will take you down shortly. And then 20 people line up for pre-board, leaving those who are truly disabled and cannot walk down to sit there and wait, taking a longer time once on the aircraft as walking 6 or 8 rows back can be a real hardship for some. And the scammers sit there grinning at their accomplishment.
Southwest Customers all used to feel valued and appreciated, whatever their fare. These days, when I travel, it seems nobody feels valued. But, in truth, isn’t that the plan of the Predator?
Next to be chopped/diminished is the CP.
Good luck after that.
WN has the same issue as JetBlue. Not a legacy airline and not an ULCC but trying to find a niche. But the cost of becoming a legacy carrier, opening lounges and remodeling planes, and expanding particularly International isn’t cheap. And if the bet doesn’t pay off an accompanying bankruptcy filing.
We’re getting to the point where Southwest would be better served winding down operations in an orderly fashion, selling off the assets and paying out the shareholders.
I used to book Southwest flights 7 months out. Funds expiration has me booking 2 months max for cash tickets. I book only points tickets farther out.
Funds expiration was the biggest mistake of all the changes.
Gary Leff points out that Southwest Airlines is eager to cater to every whim of its customers, whether they’re asking for iPhones, donuts, or flights to European destinations. So, to Southwest Airlines CEO Bob Jordan, thank you for reaching out. What I truly desire is a puppy and world peace!
@Gary: I have more personal animus against Jeff Smisek. I was Presidential Platinum and loved flying Continental because they did not get rid of perks like free food and so forth. Their flight attendants were friendly. They had a nice amenity bag in international business. Their breakfast burritos in coach were tasty. The whole cashews in business were quite good. Then, he got rid of all the perks, while bragging about his cost cutting in interviews and presentations. Then he merged Continental into United with him as a CEO, because he wanted to be a big cheese. So emotionally, I dislike Smisek the most, despite the fact other airline CEOs are probably worse. Yea, my viewpoint is not fully rationale.
But, but, but, I got a fancy brochure in the mail this week from Chase saying that if I spend SEVENTY-FIVE THOUSAND DOLLARS on the CSR I can get A-list status with WN and… wait for it… a $500 credit with WN when booked through Chase Travel! Plus the brochure told me to Embrace the Extraordinary! Are you saying that, gasp, that may not be a premium offering? The brochure was so fancy though – printed on heavy paper with gold-pressed lettering… is it all an illusion? What is real? What, even, is life?
Im surprised that Bob Jordan is still CEO. I expect Uncle Bobby to ” Retire ” early 2026.
I don’t quite understand why LUV’s share price has stayed above $30 since May. Granted, nothing like where it was at 5-10 years ago, but I sold off my mom’s (small) stake back in May, thinking it was time to bail.
Like others, I now only book SWA with points. And despite all of the shortcomings Gary outlines, I generally find the prices to be up sharply from a couple of months ago and the lowest fare type is usually “sold out”. And to add insult to injury I get almost weekly “fare sales”, that guide me to these inflated fares.
These guys are headed for disaster.
There is zero chance I renew my business card.
Chris Johnson the head of Ground Operations for Southwest is retiring and from what my wife says who still works for Southwest thinks it wasn’t by choice. TWU555 President and Secretary both suspended.
@Disco Dave. Yea, I am thinking about buying more long dated puts. I do not understand why the the stock is $31.45/share as of now (9/11/25).
They don’t need new planes. They need a new board of directors and new management.
I’m one of the long time customers who only flew Southwest – driving two and half hours out of the way to do so.
SWA used to be a lower cost airline. No more. They used to fly into smaller, underused airports which reduced bout costs and delays. No more. They had open seating and every seat cost the same – no more. Checked bags were included in the price of a ticket. No more.Flight credits never expired. No more.
Now, I don’t have a Harvard MBA, but I always thought the key to a business’s success was to be different than its competition, not to be like everyone else.
So, with Southwest in the middle of average, becoming just like every other carrier, I had to ask myself why I should drive two and a half hours out of the way to get what I can get fifteen minutes away. I could not come up with a single reason. So, in April of this year, I booked the three flights I knew I would take this year, all using Rapid Rewards points. Future travel will be based on price, schedule and how far the airport is from me.
Well, SWA, it was good while it lasted.
I wonder if Alaska wants to buy another airline? JetBlue’s route structure would fit perfectly with Alaska’s but Southwest’s planes all match Alaska’s, which can be a mixed blessing.
It is SO HARD to watch Southwest fail. Who would ever have thought? I’m hoping that junior employees know to seriously put their financial health in order & start looking elsewhere. Those of us who have admired SWA over the years are simply in disbelief. Really, really sad.
@Peter — I used to spend at least $75K/year on travel expenses earning 3x on the CSR, yet, soon that’s basically being reduced to 1x, since much of it was never on their portal. Ugh.
Play stupid games, win stupid prizes. Sad.
I’ve pulled out from WN completely at this point, only even checking pricing if they have a direct flight that others don’t. But even that seems to have fallen by the wayside, a same week (urgent personal business) ticket BWI-FLL was 650 on AA with one stop and 900 on WN direct last month. That’s insane, no thanks. I have a personal trip coming up to the northeast, but I might just take a train over this nonsense.
I just flew southwest on a direct flight that no other airline offers a direct routing on and the plane was only about 60% full. Used up some of my credits I have. I have quite a few points and about $600 in vouchers remaining but will likely never use them because I have status with United and American so get bags free with United, American, and Alaska. Primarily used them intra California on trips when visiting multiple friends since they offered direct routings and the price was comparable with 2 bags to United and American if not slightly more. Absolutely no reason to consider Southwest going forward. Seems like a lot of other people are making the same calculations.
Just another company that is spinning around the drain. Who is this CEO talking about that Southwest First Class would be appealing.
This company spent decades they were a nice low cost airline with zero frills to get you back and forth. It worked well millions upon millions used them. So now you have a brand that is saturated with the ideology that it is just that. This would be like trying to turn Walmart into Saks Fifth Avenue. It isn’t ever going to happen. They don’t even have plugs on their planes.
Expect them to try much and all to fail. Next year will be crippling with 2027 being emergency freak out mode for Southwest.
@1990 – agree 100%. I think Citi Strata Premier may be a good fit though – their 3x travel bonus: “Includes purchases at airlines, hotels (not booked through the Citi Travel site via cititravel.com), and travel agencies.” Pretty broad and should include other portals like Agoda, etc. as well. And can get a Strata Regular flavor and get 3x on select transit: “Select transit includes car rentals, ferries, commuter railways, subways, taxis/limousines/car services, passenger railways, bridge and road tolls, parking lots/garages, bus lines, and motor home and recreational vehicle rentals.” Also broad. Together it basically replaces the CSR 3x travel category.
I’ve put $75k on the CSR from time to time, but with the points categories changing, much more likely that come November i’ll be moving more of my spend to Citi. But there’s absolutely no incentive to spend $75k just to get benefits with WN. Literally the opposite of an incentive. I guess Diamond v. Platinum with IHG could be valuable for some.
@BA — Who? @Mike Hunt, that’s who. (Where’ve you been, buddy??)
First class? Flying to Europe on a 737 MAX? Good luck with that SWA!! This is a lost carrier now and think their days are limited at this point in time. Unreal
Sucks to suck. Burning through flight credits right now so I can breathe easier later. Other than a few direct flights to destinations I don’t anticipate they’ll keep as they try to emulate legacy carriers, I don’t see ever flying them again after I squeeze all the juice out of my credits and points
Southwest has massively devalued points too. Until a few months ago tickets cost 83 points per dollar of pretax fare. Now it’s routinely 100 points per dollar of base fare. That’s 20% more points.
Elliot is seeking to make SWA closely resemble the legacy carriers so as to ease the sale of SWA to one of those carriers. Very obvious.
This former customer wants free bags, no hassle refundable fares, etc. back. No differentiation between Southwest and other airlines anymore other than they’re more expensive and they have far less reach. Elliott will bleed them dry, though, which is the real point. They’ll be as financially shaky as Spirit by the time that these vampires are done with them.
Bring back the lounge seating and I’ll be back!
I’m not a frequent flyer – maybe 6-8 times a year. And I was a loyal SWA customer. But a few route changes and a few more bad experiences, and now I fly United. Happily tossed a card offer from SWA into the recycling today. Good luck to them!
Got to LUV SWA’s performance. Elliott Management has been calling the shots so they are perfect. They need to keep up the good work. (sarcasm)
SW used to be our preferred airline for domestic travel. Rarely would we even look at alternative flight options. No more. SW is just part of the mix. We shop for flights on-line on a flight search site and just select the best overall combination of price and schedule. We have rediscovered that an alternative class of service enhances a long flight coast to coast.
As a long term SW customer, I am happy to see them failed. They allowed someone who doesn’t know the business to run the business. It took away everything we loved about Southwest. I haven’t flew American in 20 years, I did it this summer because I will no longer fly Southwest.
In a world of Southwest Airlines, be a Cracker Barrel. The furor over their new logo was silly, unlike people’s complaints about Southwest, but at least they responded to the customers instead of doubling down on losing their identity. It’s wild and sad to see Southwest continue to actively burn money and talk about plans to burn more. Know Who You Are, and Be The Best You You Can Be.
Well “The Undertaker”, Elliott, is doing an excellent job with Southwest. I hope there is some way to save Southwest, but I have my doubts!
They want to fly to Europe but don’t even fly to Canada?
My last WN flights to use up some 2022 TTFs are today and Tuesday. I will be at about 3500 points, so that’s done too. There is absolutely no reason for me to fly them any more, and I was A-List on segments from the inception until the end of 2023.
@Peter — Not a bad idea (Strata Premier), though, you’d have to offset the annual fee by using the $100 hotel credit, which is the only reason I’ve kept the card, until now, since Citi brought back AA transfers, I’ll be keeping it for that reason. Still contemplating the double or triple dip with Strata Elite for later this year.
@nc-retiree — Nothing lasts forever. Hope your remaining travels with SWA go well. Remember the good times. Remember… the honest roasted peanuts, two free checked bags, free seats, etc. Ahh…
The partnership WN should be making is Easyjet, who they seem to be copying for their service model (although Easyjet is more strictly point to point in customer offer).
Easyjet is an all Airbus airline, so would be better placed to operate A321LR / XLR transatlantic as a codeshare (transatlantic would be new for Easyjet) into a WN focus city/hub.
Or use Iceland/Ireland as a traffic handover point as a trial (airports that Easyjet already serves).
I don’t think Ryanair or Wizz are possible partners.
SWA is defeating their purpose of being a great domestic airline. The fact they’ve whittled down non-stop routes makes me want to fly with someone else. I’ve been as loyal as possible to SWA for probably 20 years now when flying domestically. The constant inconveniences and longer travel times are getting old. Seems like they’re setting themselves up for a buyout/absorption.
I have been loyal to SW over years of flying. Loved their bags fly free feature. Now, I will be comparing other airlines. They had a good thing going. New CEO blew it. Sad.
Southwest is like Blockbuster, Sears, and Cracker Barrel. They’ve lost touch with their respective markets and struggled to maintain their once much in demand brands.
Southwest’s failures was laid bare for all to see back in 2018, when the airline’s operating model collapsed in what was seen as the SWA Christmas Meltdown of 2018. That holiday debacle exposed the airline’s failure to modernize its infrastructure and improve its amenities for its once loyal customer base. As of today, many of its planes still don’t have free WiFi for its Rewards members, lack basic cell phone charges, nor offer seats with extra legroom let alone assigned seating. No new foreign destinations have been added to its route map and they only just partnered with foreign airlines in 2025. Southwest lost many frequent flying customers who don’t have time for that nonsense.
I hope they can turn things around because a lack of competition is bad for the American consumer.
Ugh, they wanna fly to Europe but have never flown to Canada (Vancouver, Toronto, Montreal) or Mexican destinations (Oaxaca, Mexico City, Isla Mujeres). What European destinations is SWA considering, London, Madrid, Amsterdam, Paris, Rome? Or Barcelona, Nice, Stockholm, Berlin, Venice? Or Asia (Tokyo, Beijing, Bangkok, Singapore)? They’ll need newly retrofitted 757s for those routes, but they don’t even have basic cellphone charging outlets on all their planes yet. Geesh!
@Ryan — The speculation was Iceland, but I highly doubt any of it happens. Then again, one could’ve said that about jetBlue a decade ago, yet, today, they do fly to several destinations in Europe (with a pretty decent Business Class offering in Mint). Anything is possible… *holding breath*
@Ryan
WN would need a European partner at least to start with to make a sensible attempt at Europe. Ideally an airline that could operate A321 (LR or XLR) rather than refurbed 757 or 767. Via Iceland or partner runs long haul into WN focus cities and hubs and WN codeshares.
Hence my suggestion of Easyjet earlier on on the comments. Maybe Wizz but Easyjet service model is a better fit for what WN has become; Easyjet already can work with partners (e.g. Emirates..loyalty scheme burn option) and doesn’t come with any strategic encumberances.
People chose SW because of low fares, and free bags. Why do the executives want to make SW like the other airlines? Why would anyone fly SW when they get nothing for their money except an uncomfortable seat? No free bags, no inflight entertainment, and no seat chargers? They need to look at what made them successful in the first place. Go back to your roots SW before it’s too late.