The airline is facing pressure to boost profits and compete for high-spending travelers.
A Southwest 737 MAX 8. (Photo: AirlineGeeks | Katie Zera)
Southwest is considering changes to its traditionally low-cost business model, including airport lounges, more premium seating, and long-haul international destinations, CEO Bob Jordan said this week.
“Whatever customers need in 2025, 2030, we won’t take any of that off the table,” Jordan told CNBC in an interview Wednesday. “We’ll do it the Southwest way but we’re not going to say ‘We would never do that.’ We know we send customers to other airlines because there’s some things you might want that you can’t get on us. That includes things like lounges, like true premium, like flying long-haul international.”
If ultimately realized, the changes would mark an abrupt about-face for Southwest, which has prioritized low costs even as competitors like American, Delta, and United target high-spending travelers with new luxury cabin configurations and far-off destinations.
Jordan said it is possible for Southwest to compete directly with its U.S. rivals without losing its identity.
“I want to send fewer and fewer customers to another airline,” he said.
Jordan offered up Southwest’s hub in Nashville, Tennessee, as an example of growing customer demand for luxury, including amenity-rich lounges and long-haul flights.
“Nashville loves us, and we know we have Nashville customers that want lounges,” he said. “They want first class. They want to get to Europe and they’re going to Europe.”
Southwest’s current fleet is built around the Boeing 737-700, 737-800, and 737 MAX 8.
“Obviously you would need a different aircraft to serve that mission and we’re open to looking at what it would take to serve that mission,” Jordan said.
The CEO did not name any specific European cities as future destinations.
Southwest Airlines Boeing 737 airplanes at Dallas Love Field (Photo: Shutterstock | Markus Mainka)
Southwest is the fourth-largest airline in the U.S. by passenger volume, and for decades it has operated on a no-frills, low-cost model, with open seating, no premium or first-class sections, and free checked baggage for most passengers. The strategy won over travelers looking for a deal and helped Southwest grow dramatically between the 1980s and the 2000s.
But the airline is now in the process of rolling back many of its unique features as it faces increased costs for workers and aircraft and mounting pressure from investors to boost returns. Extra-legroom seats are being installed throughout Southwest’s fleet, and as soon as 2026 assigned seating will be implemented. The carrier also changed its baggage policy, and passengers are now charged for checked bags, though Business Select ticketholders and loyalty program members still get the perk.
In February, Southwest announced plans to lay off about 1,750 employees. It was the first company-wide layoff in Southwest’s 53-year history.
Jordan said the reductions were needed to help build “a leaner, faster, and more agile organization.”
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