Southwest Airways boasts that its passengers’ “baggage fly free” — however not for lengthy. 

Beginning Could 28 — simply in time for the busy summer time journey season — solely Southwest’s most elite Fast Rewards A-Record Most popular members and passengers who ebook their top-tier Enterprise Choose fares will obtain two free checked baggage. Frequent flyer A-Record Members, Southwest-branded bank card holders and different choose clients will probably be allowed one checked bag.

Everybody else will probably be charged for his or her first and second checked baggage on flights booked on or after Could 28, the service says.

“Simply one other airline”?

It is a break with Southwest’s 54 12 months historical past — one that would undermine buyer loyalty to the service, in response to consultants.

“That is the way you destroy a model. That is the way you destroy buyer choice. That is the way you destroy loyalty. And this, I feel, goes to ship Southwest right into a monetary tailspin,” airline business analyst Henry Harteveldt, of Ambiance Analysis Group, instructed CBS Information senior transportation correspondent Kris Van Cleave. “Southwest, with these adjustments, turns into simply one other airline.”

Simply final September, Southwest CEO Bob Jordan instructed Van Cleave baggage would proceed to fly with out cost.

“Baggage will nonetheless fly free,” Jordan stated. “It is the third factor clients search for after fare and schedule: Baggage fly free, on us. Ninety-seven % are people who find themselves conscious of our insurance policies. So it is an enormous shopper benefit. So baggage will completely fly free.”

However when pressed in the event that they’d at all times fly free, he acknowledged, “Properly, by no means say by no means. … It is like saying open seating would by no means change 20 years in the past. Client preferences change, however from every part that we see, there is no motive to rethink this in any respect, particularly proper now.”

“When 97% of your clients say they fly you due to your ‘baggage fly free’ coverage and also you make dramatic adjustments to it, you might be telling virtually all your clients, ‘Your enterprise does not matter to us anymore,'” Harteveldt stated. “We’re watching an airline self-destruct. That is the equal of intentionally crusing a ship into an iceberg.”

The price of a checked bag hasn’t been introduced however airline sources say will probably be aggressive with different carriers.

Mounting monetary strain

The transfer comes as Southwest, the nation’s fourth-largest airline, has been below intense strain from an activist investor to enhance its monetary efficiency after struggling to maintain tempo with altering buyer preferences post-pandemic.

Southwest lately introduced its first ever layoffs, launched its first redeye flights, and intends to finish its long-running open seating coverage subsequent 12 months. As an alternative, the airline will provide seat assignments and promote further legroom seats for a further charge.

Additionally introduced Tuesday are adjustments to Southwest’s Fast Rewards frequent flyer program — rising the factors flyers get for reserving higher-priced Enterprise Choose fares whereas decreasing the factors earned on cheaper “Wanna Get Away” and “Wanna Get Away Plus” fares. The airline can even begin dynamic or variable pricing for factors redemption throughout higher- and decrease demand flights.

What’s extra, beginning Could 28, Southwest will add a closely discounted fundamental financial system fare class that may assure a flyer a seat on a aircraft however will probably include restrictions just like different carriers’ fundamental financial system choices.

In a video assertion Tuesday morning, Jordan stated the adjustments “will assist us return to the degrees of profitability all of us count on, and to help our collective long run success. It is also about adapting to what our clients need.

“Many issues have modified post-Covid: the lack of short-haul demand, an increase in premium demand, and a change in buyer preferences.”

Harteveldt says, “Extra selection is at all times factor. Extra low fares are at all times factor. And Southwest is massive sufficient that in the event that they use their fundamental financial system fares in the precise manner, and I imagine they’ll, they might pressure different airways to be extra aggressive of their pricing.”

Southwest is the final main U.S. airline to supply a fundamental financial system product, which carriers launched to compete with ultra-low price airways like Frontier and Spirit. 

Whereas the choices range by airline, fundamental financial system tickets typically come with out an advance seat project, are typically within the final boarding group and should restrict the quantity or measurement of carry-on baggage.  Checked baggage and different perks include a value. It has been a success for airways. United Airways reported fundamental financial system income jumped 20% final 12 months. 

“Southwest Airways stays dedicated to its core tenets — superb individuals who ship nice hospitality to all Southwest clients, a powerful community with essentially the most nonstop flights throughout the U.S., and a loyalty program that provides actual worth to Fast Rewards Members,” the service stated in a press release.

However is the Southwest that individuals know?

“Sure,” Harteveldt stated. “This transformation is simply so in contrast to Southwest. And it truly is one thing that I fear may very well be way more financially damaging to the airline than useful.”