Southwest Investor Day Details
Southwest Airlines has revealed what will be shared at the Investor Day briefing in Dallas where Southwest leaders outline the next steps in a comprehensive three-year plan.
The carrier is transforming its customer experience to provide more choices for customers, while moving away from some of signature offerings. These changes are designed to drive revenue growth and return the carrier to industry-leading profitability.
Some of these changes have already been revealed previously, such as assigned seating and premium seats. But we’re also learning new development such as airline partners for travel to Europe.
Product Transformation
Southwest’s evolution will provide even more choices for its Customers and preserve aspects of the business that make the airline unique among its competitors:
- Assigned Seating: The Company expects to begin selling assigned seats in the second half of 2025, with its first flights operating with the new model in the first half of 2026.
- Premium Seating: Southwest will offer extra legroom options with up to five additional inches of pitch for approximately a third of its seats while maintaining a standard economy seat pitch among the best in the industry.
- Southwest Boarding with Upgrades: Southwest will change its boarding process with seat assignments while focusing on operational efficiency and improving the Customer Experience. The updated boarding process will maintain Southwest’s unique and popular approach in boarding through position numbers and signage displayed on stanchions within the gate area. The carrier’s most loyal Customers and those who purchase premium seating will continue to be among the first to board.
- Bags Continue to Fly Free: Extensive research reinforces Southwest’s bags fly free policy remains the most important feature by far in setting Southwest apart from other airlines. Based on Southwest’s research, the Company believes that any change in the current policy that provides every Customer two free checked bags would drive down demand and far outweigh any revenue gains created by imposing and collecting bag fees.
New Offerings
In addition to offering more Customer choice, Southwest will launch new capabilities and products designed to add value and revenue potential:
- Global Airline Partnerships: Southwest is formalizing partnerships with international carriers to expand its network and connect Customers with more global destinations to generate additional demand for travel across the Southwest network. Icelandair will become Southwest’s initial partner with an expected launch in 2025 through Baltimore-Washington International Airport, which will serve as its first U.S. gateway for the carriers. The Icelandair partnership will expand gateways throughout 2025, and Southwest intends to add at least one additional partner carrier next year.
- Getaways by Southwest™: In 2025, the Company intends to launch a new product, Getaways by Southwest, offering vacation packages that are unique to the industry and come with friendly policies that Customers expect from a Southwest-operated venture. These customizable vacation bundles will feature Southwest’s generous cancellation policy and flexibility with its no change fees for flights extending to hotels and other elements of packaged vacations.
- Rapid Rewards®3 Enhancements: Throughout the transformation, all Members will earn and redeem points at the same rate that they do today, and Southwest will continue to offer no blackout dates, uncapped reward seat availability, and points that don’t expire. The airline will update its Tier Benefits with the transformation giving A-List and A-List Preferred Members even better benefits. The airline also soon will share updates to its credit card program, including how assigned seats and premium seating will offer Cardmembers even more value. Until then, Cardmembers will continue to take advantage of their current card benefits. Eventually, Rapid Rewards Members also will have more opportunities to earn and redeem points for longer-haul international destinations with development of its airline partnerships and the evolution of its Getaways by Southwest product.
Optimizing Operations
Southwest is focusing on operational efficiencies to mitigate cost pressures and modernize processes. These efforts are designed to fund nearly all new capacity growth over the next three years without incremental aircraft capital deployment:
- 24-Hour Operations: In February 2025, Southwest expects to begin offering redeye flying in key markets to maximize aircraft utilization.
- Turn Times Between Flights: The airline is aiming to further reduce the time it takes to turn an aircraft, which is intended to increase its aircraft productivity, while making day-to-day processes easier for Employees.
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