Southwest is considering seat changes to spice up revenue

Southwest Airlines CEO Bob Jordan told CNBC on Thursday that the airline is considering changes to its one-class open-seat cabins to spice up revenue. This can be certainly one of the biggest within the airline's history.

“We are looking at new initiatives, such as the way we board and board our planes,” Jordan said in an interview following the airline’s disappointing first-quarter report.

Southwest's AllBoeing The 737 fleet has a single economy class cabin and no seat allocation, but offers early boarding for a fee so customers can snag their preferred seats. The airline has for years emphasized keeping its product easy and user-friendly, with the aim of keeping its own costs and complexity to a minimum.

Now also rivals delta And United have announced high sales growth for premium seats equivalent to business class and robust upselling rates.

Analysts have repeatedly asked Southwest about opportunities for premium seating or additional fees. (The airline doesn’t charge travelers for the primary two checked bags.)

Most U.S. airlines require travelers to pick out a lot of their seats prematurely, even people who don't have extra legroom. Eight US airlines – Alaska, loyalty, AmericanDelta, Border, JetBlue, Spirit and United — earned a combined $4.2 billion from seat fees on their domestic networks in 2022, in line with Jay Sorensen, airline ancillary revenue expert at IdeaWorksCompany.

Jordan said no decisions have been made yet about what sort of changes Southwest will ultimately make, but he said studies have produced “interesting” results.

“Customer preferences change over time,” Jordan said.

While few details were available on Southwest's earnings call, when asked if Southwest would consider a separate cabin on its planes, Ryan Green, the airline's chief business officer, said: “Curtains and things like that are a little bit a far cry from what Southwest Airlines is.”

Green added that the airline is not considering fees for checked baggage because “people select Southwest Airlines because we don't charge baggage fees.”