RIP Southwest Airlines.
The airline survives as a brand, and the Boeing 737s parked at LAX’s Terminal 1 still have “Southwest” painted on them. But the charmingly Greyhound-esque experience that set Southwest Airlines apart is now dead, thanks to the company’s new private-equity overlords.
On Jan. 27, the airline got rid of open seating, dealing a death blow to the signature quirk of Southwest’s appeal. The “enshitification” of Southwest Airlines – brought to you by a hedge fund that scooped up enough of the company’s shares in 2024 to force profit-wringing changes – is here.
I’ve flown Southwest most of my life, starting as an unaccompanied minor in the late 1980s ferrying between divorced parents in Los Angeles and the Bay Area (before then, the defunct Pacific Southwest Airlines was the intrastate shuttle of choice). The nothing-special airline always had a way of making its travelers feel, well, special – perhaps the egalitarian nature of the “cattle call” boarding style made one passenger feel just as welcome as any other.
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You may have been scrounging for a seat, but the crew’s comedic banter made the whole experience tolerable, even pleasurable.
Now that’s gone, along with everything else that set Southwest apart from just about every other airline. Last week, I got my first bitter taste of the remade airline when I traveled between L.A. and Philadelphia. In theory, charging for seat selection seems like no big deal because all the other major airlines do it. But in practice, it represents a massive cultural change for Southwest, fraying the nerves of passengers and the hapless frontline workers enforcing the new policies.
On board, flight attendants kept track of those who dared to switch seats, shooing wayward customers back to their assigned accommodations. The message was blunt and very unSouthwest-like: If you want a better seat, you’d better pay.
The beloved “Bags Fly Free” policy predeceased open seating at Southwest by about eight months. As CEO Bob Jordan explained in an interview with the Wall Street Journal last month, that change alone will generate an extra $1 billion in revenue annually.
It’s also generating a lot of ill will among customers. People would rather not pay $45 for something that was free last year, and it seems to me that just about everyone now tries to take their luggage on board. The result? Airline crew members who were once friendly helpers are now the seating and luggage police.
Jon Regardie
Southwest’s grab-your-own-seat boarding process was always a little chaotic but rarely rancorous. What I saw last week was chaotic and unfriendly.
“The flight attendants have gone from comedians to prison camp wardens,” said Marvin Lieberman, a professor at the UCLA Anderson School of Management. He’s writing a book about Southwest Airlines, and I happened to talk to him the day before his MBA students were supposed to discuss the airline’s new direction.
Elliott Investment Management, a hedge fund, took a $1.9-billion stake in the company in June 2024 and subsequently waged a public campaign (complete with its own podcast) advocating for changes to drive up Southwest’s stock price. The airline’s then-chairman – its former CEO and a protege of the founder who openly resisted checked-bag fees when airlines started charging them in 2008 – was quickly forced from the board of directors.
Previously, Southwest prized employee well-being, Lieberman told me, the thought being that happy workers created loyal customers. And those employees, creatures of a decades-long culture that produced the on-board “comedians,” are now the enforcers of Southwest’s private-equity overhaul. I don’t blame them for appearing uncharacteristically harried and impatient.
Tempting as it is to rage at Elliott and every other private-equity company draining businesses of what made them special, there’s another enemy here, especially when it comes to airlines: our spending habits, groomed by decades of corporate “unbundling.”
Or, what most people call nickel and diming.
Jim Newton
Lieberman told me that consumers have long demonstrated their willingness to pay for things like reserved seats and checked bags, “and those extras are where the airlines make their money.” That’s true: Big carriers became reliably profitable after they consolidated and started charging for just about every perk beyond boarding the plane.
Such “ancillary revenue” is now an essential lifeline for the airline business, and Southwest admirably held out for years – until Elliott took over.
The changes are paying off for Southwest’s shareholders. Its stock price has shot up enough for Elliott to start cashing in by selling off shares. (And yet a higher share price hasn’t translated into better profits.)
Lieberman, who believes Southwest needed to make changes to remain competitive, lamented the loss of the airline’s “kind of democratic bus service.” But he doesn’t foresee customers switching to competitors en masse (and letting all those frequent-flier points go to waste).
I’ll keep flying, I guess. I know I will miss using the peculiar southwest hacks developed over a lifetime looking for a decent seat, such as always boarding through the plane’s back door at Hollywood Burbank Airport.
That’s the Catch-22 of enshitification: You continue using a bad product because of a dependence formed during the virtuous years, and Southwest had many of those. At least Elliott and Southwest have given us another good reason to finish California’s bullet train.
