Southwest Airlines announces fare changes to attract travelers

Southwest Airlines will add a fourth fare category as part of changes aimed at attracting more business travelers and increasing revenue.

The new fare tier will be priced higher than Southwest’s cheapest tickets, but below the airline’s top two fare categories. Southwest executives believe this will close the wide price gap between the cheapest fares, called Wanna Get Away, and more expensive tickets.

Consumers who purchase the new fare tier, called Wanna Get Away Plus, earn 33% more frequent flyer points than the base ticket and can transfer the value of a ticket to another Southwest customer.

It’s the first major change to Southwest’s fare structure in 15 years. Airline officials said the changes announced on Thursday would go into effect in May or June.

Airlines often tinker with fares and fees to squeeze more revenue out of passengers. In recent years, Delta, American and United have responded to competition from discount airlines by introducing new, simple “Basic Economy” fares.

The big three airlines then urge customers to pay more for regular economy seats, which include the amenities they expect.

Southwest hinted at the changes back in December without giving details. The new rate level is among several measures, including a new credit card deal with Chase Bank that the Dallas-based airline hopes will boost annual revenue by a combined $1 billion to $1.5 billion next year.

Executives declined to say how much more Wanna Get Away Plus seats will cost compared to cheaper seats, but it will vary by flight.

In addition to more frequent flyer points and the ability to transfer credit, Plus buyers can fly on standby at no additional cost, even if the new flight has a higher fare.

Southwest will also add early boarding privileges to its next most expensive fare, called Anytime, to avoid cannibalizing full-fare ticket sales. Early boarding is an advantage, as Southwest doesn’t assign seats, meaning the last passengers to board a crowded flight end up in middle seats.

Andrew Watterson, the airline’s chief commercial officer, said any changes should be particularly attractive to business travellers. Southwest is trying to take away more business travel from Delta, American, and United.

Southwest Airlines logo
Consumers who purchase the new Wanna Get Away Plus fare earn 33% more frequent flyer points than the base fare.
Only Photo via Getty Images

Southwest’s most expensive tickets, called Business Select, are fully refundable and include early boarding, a free drink and most frequent flyer points. Anytime tickets are also refundable, but Wanna Get Away tickets are not. All three include up to two free bags — something other US airlines don’t offer — and free ticket changes.

A majority of Southwest customers purchase Wanna Get Away fares. Southwest Airlines announces fare changes to attract travelers


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