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No-fees business model gutted: Baggage Fees and Other Changes

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No-fees business model gutted: Baggage Fees and Other Changes

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Old Mar 14, 2025 | 6:22 pm
  #301  
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Originally Posted by nsx
As much as I would like to see expiration and conversion of WGA to Basic be rescinded, I think Southwest cannot recover even half the goodwill it has lost in the last week.
Nope, not for loyal hardcore fans like you & I.
But 99% of the rest of the population will suck it up with the limited choices now, WN will throw a sale and that will be that.

I worked for a few large companies and was one of very few who would go out of their way to fly them. I don't think your normal "business" flier uses them or cares unless they really have to.
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Old Mar 14, 2025 | 6:57 pm
  #302  
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I got the e-mail while on vacation and knew it'd get quite a reaction here...am late to this one and have mostly gone along liking posts.

Wall Street has been trying to pressure WN to charge bag fees for years because they're the no-stone-unturned greedy types who don't understand the value proposition and how that helped. I think the comparison of revenue gains being negated by lost business really hits it on the head. Have mentioned before how they destroyed Yahoo Auctions in the aughts by pressuring it to charge an insertion fee when they weren't ready for that. By the time the company corrected the mistake the business was damaged beyond repair, but if they kill off the company with a move like that they just move on to the next one.

Presumably I'm the kind of customer they're targeting, as Frontier has gotten a lot more business from me than they have. But I'm an anomaly, not traveling with a family and traveling enough to be an accomplished fee-avoider. I credit a lot of it to going to Asia as an air courier in the early 90s and being forced to pack two-week trips as carry-ons only (the courier company used your entire checked bag allowance back then to ship their stuff).

Giving a worse deal to Joe Sixpack families that might not be good at traveling light and might take only a trip a year or less to have a fare tier that might appeal to me doesn't seem like a good trade, especially if they're also making the FF program less rewarding (many of my F9 trips are awards). If someone wants to take the spouse and kids to Disney World and not worry so much about gotcha fees or having to learn the whole system to know what to avoid, WN has been their refuge. On Spirit or Frontier I've seen case after case of people getting surprised, including things like 50 lb. bags that met standards for legacy carriers getting charged extra because NK and F9 deliberately don't follow that standard, and stuff like that. One fee trap after another. I correctly predicted years ago that separating families to middle seats would be a PR disaster for them, though it's still possible now under certain scenarios.

I would argue there's more money catering to the Joe Sixpack families than there is to people like me. Especially with not having the global alliance or business-class option. Saving distribution costs by making people book through your own website also was whatever the opposite of a force-multiplier is, but when you were offering something different that others didn't have it made more sense.
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Old Mar 15, 2025 | 1:36 am
  #303  
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Originally Posted by bocastephen
I am seeing WN getting absolutely slaughtered on social media over this - just curious, is there a single person here on FT that supports this change?
I assume if anyone from Elliott is here on FT, they support this.

Realistically Southwest shareholders, some of which are definitely on FT, should support this. However they should also be timing carefully when to exit their holding in Southwest stock in less than one year in my opinion. Because the first year of bag fees will be a huge profit bump...

Meanwhile I am wondering what the marketing department will do for a new slogan now that they can't advertise their no fees/bags fly free thing. How about a new slogan - "Southwest. There's a fee for that."

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Old Mar 15, 2025 | 6:26 am
  #304  
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Originally Posted by FlyByMike
Suddenly i'm not so disappointed about Costco no longer selling their gift cards.
Kind of funny that my only reaction to this was: can I get a refund on the Costco WN Gift Card I bought since the conditions have changed... I wonder if they saw it coming...
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Old Mar 15, 2025 | 10:33 am
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Originally Posted by bocastephen
I am seeing WN getting absolutely slaughtered on social media over this - just curious, is there a single person here on FT that supports this change?
I support the charging of bag fees! Why? Well because they were never "free." Instead they were absorbed into the fare and people like me, who almost never check a bag, have been subsidizing those who do. I'm assuming by separating the cost of checking bags out of the fare will permit WN to lower the fare -- and that is what matters. I mostly don't fly Southwest because their fares are higher than other airlines.

I'm not happy about another devaluation of RR points though. This remains to be seen as to how drastic this may be, but lately I've been getting a lot more value with my AAdvantage points on American and have switched all my spending to my American Airlines CC. Can't see how devaluing points even further will help Southwest.
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Old Mar 15, 2025 | 11:31 am
  #306  
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Originally Posted by liberty805
I support the charging of bag fees! Why? Well because they were never "free." Instead they were absorbed into the fare and people like me, who almost never check a bag, have been subsidizing those who do.
If this were true WN could have kept the status quo. Instead their financials have been flaccid and thus the sharks came rushing in to rip things up.

$7.1 Billion in bag fees were collected in 2024 by US airlines. That money flows straight to margin (unlike a passenger ticket). WN didnt participate in probably $7B of that.

Fares wont go down. Points earning and the passenger experience will decline however.
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Old Mar 15, 2025 | 1:15 pm
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Originally Posted by liberty805
I support the charging of bag fees! Why? Well because they were never "free." Instead they were absorbed into the fare and people like me, who almost never check a bag, have been subsidizing those who do. I'm assuming by separating the cost of checking bags out of the fare will permit WN to lower the fare -- and that is what matters. I mostly don't fly Southwest because their fares are higher than other airlines.

I'm not happy about another devaluation of RR points though. This remains to be seen as to how drastic this may be, but lately I've been getting a lot more value with my AAdvantage points on American and have switched all my spending to my American Airlines CC. Can't see how devaluing points even further will help Southwest.
You're not "subsidizing" anything. Carrying bags adds minimal costs and just fills space which would otherwise go empty because Southwest doesn't take cargo. There is not a chance they will lower any fares.

Will you be happy when boarding slows to a crawl, as it does on the legacy carriers, because there's not enough bin space when everyone is incentivized to maximize their carry-ons, resulting in cascading delays throughout the day? Delta now starts boarding 40 minutes ahead of departure. So much for fast turnarounds. How about when you're running late and miss the A group and have to gate check your carry-on?
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Old Mar 15, 2025 | 1:18 pm
  #308  
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Originally Posted by liberty805
I support the charging of bag fees! Why? Well because they were never "free." Instead they were absorbed into the fare and people like me, who almost never check a bag, have been subsidizing those who do. I'm assuming by separating the cost of checking bags out of the fare will permit WN to lower the fare -- and that is what matters. I mostly don't fly Southwest because their fares are higher than other airlines.
Here's the counter: As I understand it, WN went this direction in large part to encourage folks to check bags rather than fighting over bin space, thereby facilitating faster turns. That's not going to play out brilliantly if they have to start gate-checking lots of bags (I've run into an insane number of mainline flights on DL/AA where they announce that they're going to have to start gate-checking after X point). I'm not even sure that assigned seating will play well there - if nothing else, the existing system does let folks just "grab the nearest seat".

So if I had to guess, fares won't decline on a sustained basis (individual markets may vary) but other issues will arise.

Also, as I said above, the "pay the fee and we'll refund it" approach to bag fee waivers is a disaster (and/or lawsuit) waiting to happen.
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Old Mar 15, 2025 | 2:48 pm
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Originally Posted by GrayAnderson
Here's the counter: As I understand it, WN went this direction in large part to encourage folks to check bags rather than fighting over bin space, thereby facilitating faster turns. That's not going to play out brilliantly if they have to start gate-checking lots of bags (I've run into an insane number of mainline flights on DL/AA where they announce that they're going to have to start gate-checking after X point). I'm not even sure that assigned seating will play well there - if nothing else, the existing system does let folks just "grab the nearest seat".

So if I had to guess, fares won't decline on a sustained basis (individual markets may vary) but other issues will arise.

Also, as I said above, the "pay the fee and we'll refund it" approach to bag fee waivers is a disaster (and/or lawsuit) waiting to happen.
On a recent United flight, the gate agents began demanding people's bags during boarding group 3 of 6. The flight wasn't even full. I'm sure all the travelers who weirdly pride themselves on never checking bags will be happy that they have to do it at the gate now.
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Old Mar 15, 2025 | 4:36 pm
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Originally Posted by m907
On a recent United flight, the gate agents began demanding people's bags during boarding group 3 of 6. The flight wasn't even full. I'm sure all the travelers who weirdly pride themselves on never checking bags will be happy that they have to do it at the gate now.
That's the next junk fee. Pay up to ensure you're among the first to board (regardless of seat assignment) and therefore have first access to the overheads instead of potentially being gate checked.

Maybe Early Bird lives on !!

Did they ever announce how the boarding order is going to work? Are the poles coming out? I loved the poles.
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Old Mar 15, 2025 | 10:20 pm
  #311  
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Originally Posted by joshua362
That's the next junk fee. Pay up to ensure you're among the first to board (regardless of seat assignment) and therefore have first access to the overheads instead of potentially being gate checked.

Maybe Early Bird lives on !!

Did they ever announce how the boarding order is going to work? Are the poles coming out? I loved the poles.
They previously stated they werent going to change their boarding process once assigned seating starts, but they also previously said bags would still fly free so who knows if we can trust them not to flip flop on this as well.

With the loss of not only unassigned seats, but no more free bags, Im not sure if WNs unique boarding process will still be as efficient as it is today. Turn times will likely have to increase.
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Old Mar 16, 2025 | 6:36 am
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Originally Posted by m907
On a recent United flight, the gate agents began demanding people's bags during boarding group 3 of 6. The flight wasn't even full. I'm sure all the travelers who weirdly pride themselves on never checking bags will be happy that they have to do it at the gate now.

UA/AA/DL know the count of checked bags and passenger count before boarding begins. I question if WN can provide the gate agents this information before boarding.
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Old Mar 16, 2025 | 6:49 am
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Originally Posted by TGarza
UA/AA/DL know the count of checked bags and passenger count before boarding begins. I question if WN can provide the gate agents this information before boarding.
They already do. I've heard plenty of pre-boarding announcements asking for gate checking that specify the exact number of checked bags. And I have never had any issue getting a count of empties when I ask the gate agent.
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Old Mar 16, 2025 | 9:16 am
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Originally Posted by RustyC
I got the e-mail while on vacation and knew it'd get quite a reaction here...am late to this one and have mostly gone along liking posts.

Wall Street has been trying to pressure WN to charge bag fees for years because they're the no-stone-unturned greedy types who don't understand the value proposition and how that helped. I think the comparison of revenue gains being negated by lost business really hits it on the head. Have mentioned before how they destroyed Yahoo Auctions in the aughts by pressuring it to charge an insertion fee when they weren't ready for that. By the time the company corrected the mistake the business was damaged beyond repair, but if they kill off the company with a move like that they just move on to the next one.
I was an avid user of Yahoo auctions back then, and it was working really well for me until they started charging those listing fees. Totally not worth it, and I went [reluctantly] back to eBay. Thanks for that memory!
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Old Mar 16, 2025 | 9:18 am
  #315  
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I've sold most of my admittedly few shares of LUV stock. The bump up in stock price will not be for long.
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