Much like the age-old advice to not send a letter when you are angry but instead put it in a drawer and see how you feel the next day, I wanted to sleep on it for a few days before reacting to the major changes announced by Southwest this week. Now, with a (hopefully) more level head, I can analyze these changes and what that means for customers starting May 28th this year. Here are the changes announced by Southwest and their significance moving forward:
Say “Sayonara” to Free Checked Bags
Long synonymous with the airline itself and often a focus of marketing efforts, Southwest is ending its longstanding policy of offering all customers 2 free checked bags on flights. A-List Preferred and those buying Business Select fares will still enjoy 2 free bags, while A-list and “other select customers” will get 1 free bag. Credit card customers will also get one free bag but everyone else, nada.
This policy provides some answers but leaves many important questions:
Who will be included in the “other select customers”?
Will cardholders get 1 bag total or 1 bag per person on the reservation? What if the reservation was not paid with that card (i.e. on points)? Will all 5 Chase cards get the same treatment?
How much will it cost to check a bag?
What about those traveling on the same itinerary as an A-List or A-List Preferred customer?
What about Companion Pass reservations, will those tickets get the same treatment pass holder? As both an A-List member and Companion Pass holder (for 2025 and 2026) these are important questions I will be looking to answer.
Flight Credits Will Expire (Again)
After almost 3 years of having flight credits that didn’t expire, Southwest is bringing back expiration. Flight credits will now expire 12 months after the original ticket purchase for all fare classes except the new Basic fare, which will expire after 6 months. If this change was coupled with a “travel bank” approach where credits were combined automatically, this would be less painful, but since you can only use 3 forms of payment for a new booking, using up small credits will remain difficult. Booking one-way tickets vs round trips could make more sense to better consume the smaller flight credits. It will also be interesting to see if credits from the Basic fare class later used to buy a higher fare class would push the expiration from 6 to 12 months. I wrote about this approach earlier this week to make credits transferrable.
Wanna Get Away Minus Basic
Monkey see, monkey do. Not even an original name as the new “Basic” fare replaces the iconic Wanna Get Away. Already gutted a few weeks ago, where points earning was slashed by 67%, this new fare class copies the legacy carriers Basic Economy in a race to the bottom. The big difference here is that the fare will not be changeable. I suppose you can just cancel and rebook which isn’t that different, but as noted earlier, any cancelled flight credits must be consumed within 6 months of the original ticketed date. The unknown at this point is what else will be included or excluded.
I would bet that a seat assignments will cost extra so it will be painful as infrequent traveling families try to get seats together at the back of the plane. Perhaps more important, will these passengers be able to bring a full-sized carry-on, or just a personal item? What about A-List members or credit card holders? Time will tell but regardless, it will make the jobs of the gate agents and flight attendants more difficult. I also have to ask; what is the point of a Wanna Get Away Plus if there is no Wanna Get Away? Considering that the existing Wanna Get Away fares are often uncompetitive against other carriers’ Basic Economy prices, it will also be worth watching if Southwest makes these fares more competitive since they said the Basic fare will “create new opportunities to reach consumers who value fare above everything else,” especially with free bags no longer being included.
Variable Point Value for Award Tickets
While the bag fees and flight credit expiration have received most of the headlines, this change is the one I am most concerned about. While it has never been possible to get outsized value with the points price being tied to the cash price, there was something nice about not having to think much about using cash or points for a flight. Now, it will require more mental gymnastics to decide if using points represents a good deal or not. According to the Southwest press release, they “will also introduce variable redemption rates across higher-demand and lower-demand flights.”
My prediction: this will amount to a stealth devaluation. Want to fly from Ohama to Little Rock at 6:00am on a Tuesday? You might get slightly more value for your flights. But if you want to fly to Hawaii, the Caribbean, near a holiday, or on a more popular route at peak times, expect your points to be worth less. The burning question is how far will the point values deviate from the typical ~1.35 cents per point value? Once these changes are implemented, I will do a deep dive analysis, but I am nervous this change will eventually be the worst of all that were announced this week. As an aside, this change also changes the calculus on transferring Chase points to Southwest. While not a great value today, especially for Sapphire Reserve card holders who can redeem their points for 1.5 cents per point through the Chase travel portal (or even higher value through many partners), it will likely make even less sense to transfer to Southwest in the future.
Final Thoughts
While these changes are clearly negative on the whole, with the possible exception of business travelers who are allowed to book Business Select fares, it will take time before we understand the full magnitude, particularly for A-List elite members and credit card holders. Since the credit card relationships are so profitable for the airlines (selling points to the banks) and Chase offers 5 different Southwest credit card products, there will surely be some impact. It may be an opportunity to differentiate more between the various cards, but overall if I am Chase, I am not happy with these changes. I can only imagine what founder Herb Kelleher would think if he was still around to see this evolution of his beloved company.
TL;DR: This week Southwest rolled out several negative changes effective May 28th, eliminating popular policies like free checked bags and flight credits that never expired. While there are many remaining questions on how the details will work, it is clear that much of what made Southwest unique as an airline is gone for good.
A-List Preferred here – looking forward to assigned seats and the end of the wheelchair parades. I always book one-ways, not round trips; as you noted, it’s easier to manage flight credits for canceled flights. I don’t use points much, so the devaluation, while bad, won’t ruin my day.
I suspect the gate agents and FA will be challenged with all the extra bags/checked at the gate, and this could cause delays; feel bad for them – it’s already bad with all the junk people bring on even when they COULD check for free.
I would think anyone on my reservation would get the same free bags, seat assignments, and so forth. Just my belief.
Finally, I’ve used your “trick” to combine credits and create one new credit with the canceled flight – but I too wonder if the expiration date of the final credit will be 6 or 12 months. Either way, as much as I fly, the time limit should be manageable. Just have to pay attention to what credits are sitting there.
Spot on. I am also looking forward to a significant reduction in preboarding with the new seat policies and (hopefully) consistent access to extra leg room seating. I do expect a lot of confusion and problems with the boarding process for 6-12 months once they implement, so it will be interesting to see how it plays out.