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Southwest Airlines (NYSE:LUV) is mulling whether to start charging for checked bags, reversing a policy that distinguished the Dallas-based carrier from rivals.
The carrier is polling customers for feedback on potential changes to its policies including bag charges, along with travel habits, booking preferences, and loyalty status benefits, Bloomberg reported.
“There’s no work currently underway to change our industry-leading two bags fly free policy,” the company said in a statement to Bloomberg, “but it’s important for us to know what customers want,” it added.
Southwest (LUV) is currently the only major U.S. carrier that does not charge for two checked bags. The benefit has distinguished the company from competitors who charge $35 to $60 for the first checked bag, with certain exceptions, like using an airline-branded credit card for the airfare. The world’s largest carriers made $33B in checked baggage fees in 2023, up 15% year-over-year.
Southwest (LUV) might be encouraged to end its “Bags Fly Free” perk and take a piece of the multi-billion-dollar bag fee windfall amid pressure from Elliott Management which recently acquired a substantial stake in the carrier. The activist investor has been pushing for changes in management, as well as modifications to Southwest’s operational policies to lure in travelers, increase efficiency, and raise revenues.
Last month, Southwest changed its free-for-all-seating procedures, added a new premium class, and began offering red-eye flights.
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