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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.

7/25/24 8:12AM

Southwest’s, 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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Volkswagen is reportedly closing in on its own, separate tariff deal with the US

In a bid to get its own tariff rate below the 15% applied to most EU exports, Volkswagen is dangling big US investments.

Speaking at a trade show Monday, VW CEO Oliver Blume said the automaker is in advanced talks on a deal to limit its own tariff burden. Volkswagen reported a tariff cost of $1.5 billion in the first half of the year.

Speaking to Bloomberg TV, Blume said the company is in close contact with the Trump administration and has had “good talks” about its separate deal. The current 15% tariff rate on EU vehicles would still “be a burden for Volkswagen,” Blume said.

A company reaching a tariff deal separate from its home country isn’t typical, though there’s already precedent this year, with Apple’s $100 billion US investment deal amid chip tariffs and President Trump’s threats to add a levy to smartphones. Nvidia and AMD similarly struck a deal to receive the ability to sell chips in China and in exchange agreed to give the US 15% of the revenue from those sales.

Speaking to Bloomberg TV, Blume said the company is in close contact with the Trump administration and has had “good talks” about its separate deal. The current 15% tariff rate on EU vehicles would still “be a burden for Volkswagen,” Blume said.

A company reaching a tariff deal separate from its home country isn’t typical, though there’s already precedent this year, with Apple’s $100 billion US investment deal amid chip tariffs and President Trump’s threats to add a levy to smartphones. Nvidia and AMD similarly struck a deal to receive the ability to sell chips in China and in exchange agreed to give the US 15% of the revenue from those sales.

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