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Service dogs flying on Southwest.
These good bois (or girls) should still get to sit wherever they want (Getty Images)

Southwest ditches its love-it-or-hate-it open seating policy

After decades of open boarding, the company is planning “transformational” changes to make its boarding and seating just like everybody else’s.

Southwest Airlines, which built a reputation over decades for being different than all the other airlines, has decided it should probably just be like all the other airlines. 

The company said Thursday that it would do away with its love-it-or-hate-it open seating policy and instead change its boarding process, assign seats, and offer premium seating options. About a third of Southwest’s seats will now offer extended legroom, “in line with that offered by industry peers,” the company said.

There’s lots of talk in the press release about meeting customers’ needs and “fostering more loyalty” among flyers, but a company executive also said the quiet part out loud: “These changes are expected to generate additional revenue as we capitalize on greater demand.”  

Just in case any Southwest aficionados want to complain about the changes, the airline has a whole bevy of stats ready to explain to you how great of an idea this is: Southwest said it did “thoughtful and extensive research” on the changes and that 80% of Southwest customers and 86% of potential customers prefer to have an assigned seat. 

It also says it ran live boarding trials and “over 8 million simulation-based boarding trials” before committing to the change. (No word on whether the simulated boarding trials included a person who spends 10 minutes trying to jam their absolutely stuffed carry-on into the overhead bin when it’s painfully obvious to anybody with eyeballs that it isn’t gonna fit, then has to clog the aisle all the way back to the front of the plane to check it.)

The moves come as Southwest contends with activist investor Elliott Investment Management, which has built up a $1.9 billion stake in the company and is agitating for operational changes. 

Southwest stock was down about 5% in premarket trading, though it’s unclear whether that’s a reaction to the changes or the 46% drop in quarterly profit Southwest also reported.

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How Tesla quietly wound up owning a small piece of SpaceX

Tesla is converting its recent $2 billion investment in Elon Musk’s AI company, xAI, into a small ownership stake in SpaceX — just months before the rocket maker’s highly anticipated IPO.

Here’s what happened: Tesla announced its xAI investment in late January, after a shareholder proposal to invest fell short last year. Several days later, xAI merged with SpaceX. All three companies are headed by Musk.

Now, regulatory filings with the Federal Trade Commission show Tesla converting that investment into a small stake in SpaceX, formalizing the financial link between the companies ahead of the rocket maker’s IPO. SpaceX is expected to go public this year at a valuation some speculate could top $1.75 trillion, potentially making it the biggest company to ever go public. (The current record holder, Saudi Aramco, went public at a more than $1.7 trillion valuation in 2020.)

While the size of Tesla’s stake wasn’t available, Bloomberg reports that the investment would equate to ownership of less than 1%.

While SpaceX and Tesla have engaged in related-party transactions over the years, Tesla had not previously disclosed an equity investment in SpaceX.

Now, regulatory filings with the Federal Trade Commission show Tesla converting that investment into a small stake in SpaceX, formalizing the financial link between the companies ahead of the rocket maker’s IPO. SpaceX is expected to go public this year at a valuation some speculate could top $1.75 trillion, potentially making it the biggest company to ever go public. (The current record holder, Saudi Aramco, went public at a more than $1.7 trillion valuation in 2020.)

While the size of Tesla’s stake wasn’t available, Bloomberg reports that the investment would equate to ownership of less than 1%.

While SpaceX and Tesla have engaged in related-party transactions over the years, Tesla had not previously disclosed an equity investment in SpaceX.

Southwest Airlines At San Diego International Airport

Southwest stopped fuel hedging a year ago. Whoops.

It’s been a year since Southwest said it would end its fuel-hedging program. Oil’s moves this year make that decision look like a mistake.

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