Not since Bud Light partnered with Dylan Mulvaney has a major company so thoroughly trashed its own brand.
On Tuesday, Southwest Airlines announced an end to its “bags fly free” policy. It will join most other airlines in charging for luggage. To avoid charges, customers must purchase more expensive tickets, be a very frequent flyer or have the airline’s credit card.
This isn’t just a shift in strategy. It’s a betrayal.
In 2015, Southwest launched its “Transfarency” advertising campaign. It highlighted the airline’s low fares with “nothing to hide.” It had a microsite for the campaign that included a quiz on the “other airlines’ ridiculous fees.”
“We’re not going to nickel and dime our customers,” Kevin Krone, then-Southwest vice president and chief marketing officer, said in 2015. He continued, “Transfarency is not a new chapter for us, but another tone to the bell that we’ve been ringing for more than 44 years.”
A Southwest ad stated: “Transfarency means we don’t dream up ways we can trick you into paying more. It means respect. We don’t just fly you. We like you.”
The airline continued this messaging for years. Millions of people, myself included, believed it. I’ve been a loyal Southwest customer for my entire adult life. Don’t tell Dave Ramsey, but I’ve even had the Southwest credit card — paid off every month, I promise. My basic process for buying an airline ticket is to go to Southwest’s website and see when tickets are cheapest. Unless the price seems unreasonably high, I usually book it without checking around.
Why bother? It’s a pain to try to figure out the actual cost of a ticket on other airlines. Southwest would probably be cheaper anyway.
This philosophy worked out well for Southwest. It grew from a small regional carrier into one of the four largest airlines in the country. Before the pandemic, it was profitable for 47 consecutive years. That’s incredibly impressive in a business as up-and-down as air travel. The three other largest airlines, American, Delta and United, have all gone bankrupt in the past 25 years. Spirit Airlines, another major carrier, is also just coming out of bankruptcy.
The easy villain here is hedge fund Elliott Investment Management. Last June, it took a significant position in the company and said the airline was underperforming. It has pushed for revenue-generating changes. Say goodbye to open seating.
It’s a valid critique to note that hedge funds can act in a predatory manner. Forcing a company to strip-mine its brand and customer goodwill can temporarily boost profits. It’s terrible for the company’s long-term outlook. By then, however, the hedge fund will be long gone.
Don’t overlook why Southwest was having financial struggles. In recent years, its unions demanded and received massive pay hikes. For instance, in January 2024, pilots approved a contract that will increase their pay by nearly 50 percent by 2028. Some of that money will soon be coming from bag fees.
Most Southwest customers won’t care about the backstory. They’ll be wondering where their airline went.
I assume I’ll fly Southwest again at some point, but I won’t trust it like I did before. Bummer.
Contact Victor Joecks at vjoecks@reviewjournal.com or 702-383-4698. Follow
@victorjoecks on X.