Southwest Airlines’ unique open-seating approach could soon change

FOMO doesn’t just hit college students grappling with whether to go out on a Wednesday night.

Southwest Airlines is considering a change to its unique-in-the-industry open-seating policy, CEO Bob Jordan told CNBC yesterday. This comes as rivals continue to invest in and make bank off of premium seating and upsells – something the airline has missed out on.

• Delta Air Lines generated $19.1 billion in premium-seating revenue in 2023, a 26% increase from 2022.
• United Airlines has increased its domestic premium seat capacity by 25% over the past five years. And it’s paid off. In Q1 2024, the airline reported a premium cabin-revenue increase of 14% year-over-year.

Seating fees (aka upsells) can also make like a calculator and add up. Eight US carriers – Alaska, Allegiant, American, Delta, Frontier, JetBlue, Spirit, and United – collectively brought in $4.2 billion from seating fees in their domestic networks in 2022, per data reported by CNBC.

Yes, but…Just because Southwest is considering a seating policy change doesn’t mean it’ll actually make one.

That being said: The airline is coming off a disappointing Q1 and looking for ways to boost revenue. Despite strong travel demand, Southwest posted a wider loss in the quarter than the same period last year, and warned that Boeing’s airplane delays will hamper its growth into 2025.

👀 Looking ahead: Southwest will reportedly announce a decision on seating changes and introduce “a whole series of initiatives” (including overnight red-eye flights) at an investor day on September 26.