Southwest Airlines is introducing checked baggage fees, ending its long-standing free bags policy. What does this mean for travelers, costs, and Southwest stock?
Introduction: Southwest Airlines Checked Baggage Fees Are Here—What’s Next?
For years, Southwest Airlines stood out from competitors with its unique bags fly free policy. While other airlines charged for checked luggage, Southwest free checked bags became a key selling point, making the airline a favorite among budget travelers. But things are changing.
As of May 28, 2024, Southwest Airlines baggage fees will be introduced for most travelers. Unless you’re a Southwest credit card holder, a Business Select passenger, or a top-tier Rapid Rewards member, you’ll soon be paying for Southwest checked bags just like you do with other airlines.
This major shift raises concerns about affordability, transparency, and how it affects Southwest’s competitive edge. Let’s dive into the details of Southwest baggage fees, how they compare to other airlines, and what this means for passengers.
1. Southwest Airlines Checked Baggage Fees: What’s Changing?
For decades, Southwest baggage policy was simple: two free checked bags per passenger. Now, that policy is ending for most customers. Here’s what we know so far:
- Who Still Gets Free Bags?
- Southwest free checked bag policy remains for Rapid Rewards A-List Preferred members, Business Select ticket holders, and Southwest credit card customers (with some limitations).
- One free checked bag for A-List members and select customers.
- All other passengers will now pay Southwest Airlines baggage fees for checked luggage.
- How Much Will It Cost?
- Southwest Airlines has not released exact pricing yet, but industry estimates suggest fees could range between $30-$50 per bag.
- Compared to competitors, Southwest’s new charges may still be competitive, but it’s a sharp departure from the Southwest free bags policy.
- When Does It Start?
- The new Southwest baggage fees apply to flights booked on or after May 28, 2024.
This move aligns Southwest Airlines baggage policies with industry norms, but it also removes a major advantage that set Southwest apart from other carriers.
2. Why Is Southwest Charging for Bags?
The decision to introduce Southwest baggage fees is primarily about revenue. According to industry analysts, Southwest was potentially losing $1.8 billion per year by not charging for baggage. Meanwhile, major competitors like Delta, American, and United rake in billions annually from baggage fees.
But will this strategy work? Southwest estimates that charging for bags could generate an additional $1.5 billion per year. However, there’s a risk: Southwest could lose customers who choose airlines based on overall pricing rather than loyalty.
Financially, the move is already making waves. Southwest stock (LUV stock) jumped over 9% on the day of the announcement, signaling investor confidence in the profitability of this decision.
3. What This Means for Travelers
For customers, the introduction of Southwest checked bag fees means reconsidering travel plans. Here’s how it affects different types of travelers:
- Budget Travelers: Those who relied on Southwest free bags to avoid extra costs may now look elsewhere or shift to carry-on bags.
- Business Travelers: Companies that book employees on Southwest Airlines may need to adjust budgets or factor in additional baggage fees.
- Families: Large families who used to check multiple bags for free could see costs add up quickly.
A frequent traveler, Dorothy Severson, shared her disappointment:
“I would rather have the free checked bags, that’s for sure. It’s one of the main reasons I still fly Southwest.”
Will travelers stick with Southwest Airlines, or will they jump ship to competitors? That remains to be seen.
4. The Bigger Picture: Southwest Airlines’ Strategy and Stock Performance
This move is part of a larger strategy shift at Southwest Airlines. The airline recently announced plans to introduce assigned seating (ending another long-standing policy) and charge extra for more legroom.
- Southwest Changes & Stock Performance:
- Southwest stock (LUV stock) surged after the baggage fee announcement.
- Airlines like Delta and United see this as an opportunity to attract former Southwest customers.
- Investors see Southwest charging for bags as a positive step toward increased profitability.
But there’s a catch: The airline industry is facing economic uncertainty. Airlines like Delta and American have seen their stock prices drop as travel demand shifts. If Southwest baggage fees push customers away, it could backfire financially.
5. Southwest Airlines vs. Competitors: How Does It Compare?
With Southwest ending free bags, it now follows the industry standard. Here’s how its new baggage policy might compare:
| Airline | First Checked Bag Fee | Second Checked Bag Fee | Free Bags for Loyalty Members? |
|---|---|---|---|
| Southwest (new policy) | TBD ($30-$50 estimated) | TBD | Yes, for select passengers |
| Delta | $30 | $40 | Yes, for loyalty members & credit card holders |
| United | $35 | $45 | Yes, for certain fare classes & credit card holders |
| American | $30 | $40 | Yes, for loyalty members & premium fares |
| JetBlue | $35-$45 | $50 | Only for premium fares |
This means that Southwest Airlines baggage fees might still be competitive, but the removal of Southwest free checked bags is a loss for travelers.
Conclusion: The End of an Era for Southwest Baggage Policy
The introduction of Southwest Airlines checked baggage fees marks a major shift in how the airline operates. While Southwest free checked bags were a beloved perk, the airline is now focusing on boosting profits and competing with industry giants.
For travelers, this means reconsidering their loyalty. Is Southwest Airlines baggage policy still worth it? Or will customers look for better deals elsewhere?
One thing is certain: The airline industry is changing, and Southwest charging for bags is just the latest move in a growing trend of additional fees. As travelers, we must stay informed and adapt to these changes to ensure we get the best value for our money.
Would you still fly Southwest Airlines after these changes? Let me know your thoughts!