Southwest Airways is thought for its remarkably constant enterprise mannequin, which hasn’t modified an entire lot over time. The airline gives two free checked baggage to all passengers, doesn’t have assigned or premium seating, and doesn’t promote fundamental financial system.
With the way in which the trade has advanced, executives on the airline are actually hinting at some potential modifications to the enterprise mannequin, which might have main implications for passengers.
Southwest considers modifications to onboard seating
Southwest reported its Q1 2024 monetary outcomes in the present day, and it was principally dangerous information. That’s largely resulting from a grim outlook because of Boeing 737 MAX manufacturing and certification points (for the reason that airline solely flies 737s), however even past that, unit income for Q2 2024 is predicted to be down in comparison with final 12 months.
Whereas Southwest CEO Bob Jordan had fairly a bit to say concerning the firm’s monetary outcomes, there was one remark that’s in all probability going to be most fascinating to Southwest prospects:
“We’re evaluating choices to boost our Buyer Expertise as we research product preferences and expectations, together with onboard seating and our cabin.”
There’s not an entire lot extra background on this, however modifications to onboard seating and cabins suggests a few almost certainly outcomes:
- Southwest has by no means assigned seats, however somewhat assigns boarding positions (and elite members and those that pay additional can get a greater boarding place); might Southwest lastly introduce assigned seating?
- As we’ve seen lately, demand for premium journey merchandise is means up, so might Southwest introduce an additional legroom financial system part, or probably even first-class?
Whereas all we will do is speculate as of now, I feel it’s not too onerous to determine what Southwest administration is likely to be hinting at right here. Personally I don’t see Southwest introducing first-class, as a result of that simply appears too radical of a change for the service’s enterprise mannequin.
Nonetheless, an additional legroom seating possibility appears logical, and when you’re going to introduce additional legroom seating, then it additionally is sensible to ditch open seating. In some ways, Southwest has already given us a clue about how this would possibly occur.
A few months in the past, Southwest unveiled new cabins, which might be put in on newly delivered plane as of 2025. What’s fascinating is that these seats are thinner than current seats, but Southwest says it doesn’t plan to extend the variety of seats on its planes.
Airways aren’t charities (even when their steadiness sheets could at instances counsel in any other case), so it appears counterintuitive to present passengers much more legroom, somewhat than making an attempt so as to add extra seats.
Whereas Southwest hasn’t introduced plans to introduce additional legroom seating, that looks like the one logical conclusion. With thinner seats, there might be extra potential legroom, so Southwest might lastly introduce an additional legroom part of the plane. There’s simply not one other logical clarification.
Is Southwest’s consistency an asset or legal responsibility?
As I discussed at first of this publish, Southwest has in all probability been essentially the most constant airline over time when it comes to not altering its enterprise mannequin, no matter what rivals are doing. The US world legacy carriers have advanced to change into extra worthwhile, higher competing with extremely low value carriers, by more and more fragmenting the market.
In the meantime Southwest has simply stored doing what it has been doing for many years, and has been one of many higher performing airways over time. I feel some folks fall into the lure of pondering that if an airline is worthwhile and does a sure factor, that should imply that it’s the appropriate factor to do. In lots of circumstances, airways are worthwhile despite sure enterprise practices, somewhat than due to them.
I feel what has stored Southwest worthwhile over time in comparison with different primarily home airways is the dimensions of its community, its fleet simplicity, and the excessive engagement in its loyalty program, thanks largely to a nice flying expertise and pleasant employees.
The airline has excessive labor prices, and tremendously lags different carriers in terms of ancillary income. One wonders how Southwest can be performing if it had additional legroom financial system seating, assigned seats, no free checked baggage, and fundamental financial system.
Backside line
Southwest executives state that the airline is contemplating modifications to the onboard expertise and cabins. After all the primary two issues that come to thoughts are ditching open seating, and introducing a premium seating product.
We all know that Southwest will introduce new, thinner seats in 2025, with out growing the seat depend. To me that actually means that the airline would possibly lastly introduce additional legroom financial system seats, because it doesn’t appear logical to simply improve legroom all through the cabin.
What sort of modifications do you assume we’ll see to Southwest’s cabins?
