Southwest Airlines Ends 'Bags Fly Free' and Introduces Assigned Seating

Southwest Airlines, long celebrated for its customer-friendly policies, has announced significant changes to its operations, including the end of its "Bags Fly Free" policy and a shift from open seating to assigned seating. These adjustments aim to enhance profitability and align the airline more closely with industry standards.

Effective May 28, 2025, Southwest will begin charging passengers $35 for the first checked bag and $45 for the second. Exemptions apply to Business Select passengers, Rapid Rewards A-List Preferred members, and holders of the airline's co-branded credit card, who will continue to receive free checked bags. This marks a departure from the airline's longstanding policy of allowing two free checked bags, a feature that has been central to its brand identity.

In addition to baggage fees, Southwest plans to transition from its traditional open seating model to assigned seating starting January 27, 2026. This change will include offering premium seating options with extra legroom and preferred boarding for an additional fee. The airline will introduce new fare bundles:

• Choice Extra: Includes extra legroom seat selection, two free checked bags, earlier boarding, ticket refundability, day-of-travel perks, and the highest Rapid Rewards points earn ratio.

• Choice Preferred: Offers preferred seat selection, earlier boarding, ticket refundability, and day-of-travel perks.

• Choice: Allows standard seat selection at booking, transferable flight credit, and flexibility for same-day changes.

• Basic: Provides a standard seat assigned at check-in, is nonrefundable, and does not allow for changes.

These strategic changes are projected to generate approximately $1.5 billion annually from the new baggage fees. The introduction of assigned seating and premium options is expected to contribute an additional $1.5 billion in incremental earnings before interest and taxes (EBIT) by 2027.

Southwest's decision to implement these changes comes amid financial pressures and investor demands for increased revenue streams. The airline has faced challenges in maintaining profitability, prompting a reevaluation of its business model. In July 2025, Southwest appointed Doug Brooks as the new independent chair of its board of directors, effective August 1, 2025. Brooks, a director at Southwest since 2010 and former CEO of Brinker International, succeeds Rakesh Gangwal, who stepped down due to other commitments but remains on the board.

The airline industry has seen a trend toward unbundling services, with many carriers charging separately for checked bags, seat selection, and other amenities. Southwest's adoption of these practices aligns it more closely with competitors like Delta, American, United, JetBlue, and Alaska Airlines, all of which have long employed assigned seating and baggage fees.

The introduction of baggage fees and assigned seating has elicited mixed reactions from customers. While some appreciate the added options and flexibility, others view the changes as a departure from the airline's customer-centric values. Critics have labeled the shift as a "money grab," expressing concerns over increased costs and the potential erosion of brand loyalty.

Southwest CEO Bob Jordan defended the decision, stating that the changes align with customer demand for more certainty and family-friendly seating. He emphasized the airline's commitment to maintaining its core values through its "amazing people who deliver great hospitality."

As Southwest Airlines implements these significant policy changes, the success of these initiatives will depend on the airline's ability to balance financial objectives with maintaining customer loyalty. The coming years will reveal how these strategic shifts impact Southwest's position in the competitive airline industry.