Carrier Reverts ‘Bags Fly Free’ Rule, Charges $35 for the First Bag

Self-proclaimed low-cost carrier Southwest Airlines has officially reverted a long-standing policy and will be charging $35-45 per checked bag. This is part of a recent, yet determined push for improved profitability... i.e., greed.

Fortunately, the policy change only applies to future bookings. It also includes several exceptions, including for passengers who book Business Select, hold Rapid Rewards A-List Preferred status, or are residents of Hawaii with a valid Hawaii mailing address traveling between the islands. A-List members and holders of Rapid Rewards credit cards will continue to receive one free checked bag.

Southwest initially announced its intended policy change in March as part of a broader set of structural changes intended to boost cash. The airline has struggled to get investors off its back, particularly Elliott Investment Management, which took a $1.9 billion stake in the company last year.

“We have tremendous opportunity to meet current and future customer needs, attract new customer segments we don’t compete for today, and return to the levels of profitability that both we and our shareholders expect,” explained Bob Jordan, CEO and Vice Chairman of Southwest's Board of Directors.

The fee structure puts Southwest on par with the rest of the US’s big five: American Airlines, Delta Air Lines, United Airlines, and Alaska Airlines. All of these carriers charge between $35 and $40 for the first checked bag, and typically slightly more for the second.

Southwest estimates that the new baggage policy could generate around $1.5 billion in annual revenue. However, the airline has also acknowledged a potential downfall: an estimated $1.8 billion in lost customer loyalty -- including ours. 

FMI: www.southwest.com