Southwest Airlines Considers Long-Haul International Flights
Bob Jordan, the CEO of Southwest Airlines, mentioned on Thursday that the airline is looking into expanding its services to include long-haul international flights and premium airport lounges as part of its strategy to recover from the impacts of the pandemic.
He noted that in pursuing long-range international routes, the company would have to consider widebody aircraft. However, a more cautious approach is currently in place, so they might initially use narrow-body jets for these new routes.
Based in Dallas, Southwest primarily operates domestic flights with a fleet of Boeing 737s, yet the airline is having a tough time re-establishing its footing post-Covid-19. The drop in revenue is pushing them to rethink their business model.
Recently, the airline imposed fees for checked bags, moving away from their previous free policy. They also launched a new Basic Economy Fare and shifted to a new allocated seating policy in January, ditching the old open seating model.
Jordan previously expressed interest in launching flights to Europe. Industry analysts suggest that not offering long-haul international flights could limit Southwest’s customer appeal and result in lost revenue opportunities to competing airlines.
Since February, Southwest has formed partnerships with foreign carriers such as Icelandair, China Airlines, and EVA Air to expand its network. The airline is also considering new partnerships globally.
However, Jordan mentioned a desire for Southwest to operate the long-distance international routes directly. “We aim to serve those destinations ourselves,” he stated at the Morgan Stanley Conference, while noting that the plan is still in its preliminary stages.
Before the pandemic, Southwest enjoyed 47 consecutive years of profitability but has faced challenges in maintaining sustainable profit margins since. Currently, its margins are not as strong as those of competitors like Delta and United Airlines.
Recent changes appear to target attracting more affluent travelers. Jordan pointed out that without flights to high-demand destinations like London or premium airport lounges, the airline risks losing customers to other airlines. He highlighted that introducing a lounge could enhance their loyalty revenue by making co-branded credit cards more enticing for customers.
“As the largest domestic airline, we must continue to adapt and meet our customers’ needs,” Jordan concluded.
