A Southwest Airlines Boeing 737-700 airplane lands at Ronald Reagan Washington National Airport in Arlington, Virginia, on May 7, 2023.
Nicolas Economou|Nurphoto|Getty Images
Southwest Airlines is thinking about modifications to its single-class, open-seating cabins to increase earnings, CEO Bob Jordan informed CNBC on Thursday, a shift that would be amongst the biggest in the airline company’s history.
“We’re looking into new initiatives, things like the way we seat and board our aircraft,” Jordan stated in an interview after the provider’s frustrating first-quarter report.
Southwest’s all-Boeing 737 fleet has a single economy class cabin and no seating tasks, though it does provide earlier boarding for a cost so clients can snag their chosen seats. The airline company has actually concentrated on keeping its item basic and easy to use for many years, intending to keep its own expenses and intricacy to a minimum.
Meanwhile, competitors consisting of Delta and United have actually promoted high earnings development for premium seating such as organization class and strong upsell rates.
Analysts have actually consistently asked Southwest about chances for premium seating or extra charges. (The airline company does not charge tourists for their very first 2 inspected bags.)
Most U.S. airline companies charge tourists to pick a number of its seats beforehand, even those that do not included additional legroom. Eight U.S. providers– Alaska, Allegiant, American, Delta, Frontier, JetBlue, Spirit and United– together generated $4.2 billion from seating charges in their domestic networks in 2022, according to Jay Sorensen, an airline company secondary earnings specialist at IdeaWorksCompany.
Jordan stated no choices have actually been made on what sort of modifications Southwest will eventually make, however he stated research studies have actually yielded “interesting” results.
“Customer preferences do change over time,” Jordan stated.
While information were limited throughout Southwest’s incomes call, when asked whether Southwest would think about an apart cabin on its airplanes, Ryan Green, the provider’s primary business officer stated: “Curtains and things like that are a bit far afield from what Southwest Airlines is.”
Green included that the provider is ruling out charging for inspected bags due to the fact that “people choose Southwest Airlines because we don’t have bag fees.”
— CNBC’s Phil LeBeau added to this report.
