A Boeing 737 operated by Southwest taxis at Denver International Airport (KDEN). [Credit: Shutterstock]
Key Takeaways:
Southwest Airlines is undergoing a significant transformation under CEO Bob Jordan, moving away from its traditional open seating and "bags fly free" policies, driven by customer demand for more choices and premium offerings.
The airline is adopting a more conventional business model, introducing tiered fare bundles, increasing bag fees for basic fares, and considering premium additions like lounges, first-class seating, and eVTOL services.
Despite reduced influence from activist investor Elliott Management, Jordan asserts the changes will continue to give customers fewer reasons to choose competitors.
While these changes initially impacted profits in 2025, Southwest projects a substantial profit surge in 2026, indicating confidence in its new strategy to balance affordability with more diverse offerings.
Southwest Airlines may see less activist investor influence after Elliott Management—which pushed it to enact major changes, such as axing its long-standing open seating and “bags fly free” policies—reduced its stake in the carrier in February.
But CEO Bob Jordan said the airline is “not done” shaking up its business.
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Jack is a staff writer covering advanced air mobility, including everything from drones to unmanned aircraft systems to space travel—and a whole lot more. He spent close to two years reporting on drone delivery for FreightWaves, covering the biggest news and developments in the space and connecting with industry executives and experts. Jack is also a basketball aficionado, a frequent traveler and a lover of all things logistics.
