Southwest Airlines announced in a news release yesterday that they will forego a 54-year initiative and start charging passengers fees for checked bags.
“I saw a TikTok about this and I’m mad,” Emily Chang, a sophomore philosophy, politics, and economics major who frequently uses Southwest Airlines’ two free checked bags policy said. “I take heavy advantage of the [policy]. It helps me bring stuff I need back from home and take back stuff I’m not using to free up space in my dorm.”
Chang, like many other students looking for an economical airline choice, uses Southwest primarily to fly between school in Los Angeles and home in Arizona.
Bob Jordan, president, chief executive officer and vice chairman of the board of directors at Southwest Airlines said “It’s about securing our future. We’re announcing changes to our business that will help us return to the levels of profitability we all expect and to support our collective long-term success,” in a “soundbite” on Southwest’s newsroom.
The free checked bag initiative previously made the airline stand out compared to other airlines and many credit it for why it is their preferred airline for out-of-state college students. But Southwest says those features are not the focus of their mission.
“We are more than the logo on our planes. Our DNA isn’t open seating or even bags fly free. It’s a dedication to service and hospitality and to the golden rule for each other and for our customers,” said Jordan.
“I’ve literally never paid for luggage,” Karyaveer Misra, a sophomore cinema and media studies major said. “That’s one of the main reasons I choose [Southwest].”
The new policy will go into effect on May 28, 11 days after finals. Only A-list preferred members, Southwest credit card holders and those who have a Business Select ticket will be allowed one free check bag.
Misra has none of those perks. He typically flies home two or three times a school year.
“It’s definitely going to change how often I fly home,” Misra said. “Last year, I was able to get away for a long weekend, but I don’t think I’ll do that with all these extra charges.”
Henry Hartell, an airline industry analyst at Atmosphere Research Group, gave insight as to why Southwest made the change.
“This was a decision imposed on the airline by Elliot group, which is an activist investor that owns roughly 11% of the company, stock and its board,” Hartnell said.
Hartnell explained that this isn’t a change that has been planned, and it’s being imposed due to concerns about Southwest’s business performance since they’re not making the profits they would like.
“Rather than take the time to explore other strategies on how they could generate additional revenue, they decided to impose this checked bag fee,” Hartnell said.
Southwest recently conducted an investor day at its Dallas headquarters where it shared data in a presentation. Southwest found that 97% of customers are aware of the free checked bag policy and that’s the third most cited reason why people choose Southwest.
They also found that charging bag fees could make them about $1.5 billion a year, but they could lose $1.8 billion a year because customers could choose other airlines.
“[The US airline industry] is a very sad, homogeneous blob,” said Hartnell “Southwest has always been, from day one, an egalitarian airline, they’ve never had first class, they’ve never had extra legroom seats or anything else like that. So they’re looking more and more and acting more and more like American, Delta and United.”
Stanley Turner, a sophomore film and television production major, doesn’t understand how Southwest is different now.
“Without the bag accommodations, I’m likely to just pick whatever airline gives me the best price on the ticket itself,” Turner said.
“That’s gonna be a huge inconvenience. Especially at the start and end of the school year when I’m traveling with literally all of my stuff. I depended on having those bag accommodations,” Turner said.
Leyna Nguyen, a sophomore business administration major will now consider more options as opposed how she depended on Southwest and its checked bags every time before.
“If other options are cheaper, or there’s a two bag policy, then I’m going to use that airline,” Nguyen said.
Given the general instability of the U.S. economy, with everyday essentials increasing in price while the job market remains unpredictable, cheaper options are top of mind.
“I think this is going to be looked at as a self-inflicted wound on Southwest,” Hartnell said. I think it’s going to be highly destructive to brand preference for the airline and highly destructive to customers’ views about the airline.”
Chang said that she will most likely be taking her business to American Airlines.
“American allows a personal item and carry on, and I normally would pack the same for Southwest without the checked bags,” Chang said.
Chang says the last time she flew Southwest, the flight attendants forgot to give her a complimentary snack. Now, she’s feeling salt in the wound and hurt in her pocket.