Southwest Airlines shifts to paid baggage policy to lift earnings

 By Rajesh Kumar Singh

March 12, 20251:09 AM GMT+5Updated 9 hours ago

A Southwest Airlines jetliner departs from Chicago Midway International Airport in Chicago, Illinois, U.S., December 27, 2022. REUTERS/Kamil Krzaczynski/File Photo Purchase Licensing Rights

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• Summary
• Companies

• Southwest to charge for checked bags starting May 28
• New fees aim to reward loyalty and boost profits
• Baggage fees could add $1.5 billion revenue annually
Its "bags fly free" policy has been an outlier in the airline industry. Southwest is the only major U.S. carrier that allows customers to check two bags at no cost, a strategy that company executives have said differentiates it from rivals.
But the policy change, which would take effect on May 28, runs the risk of driving away customers. Delta Air Lines (DAL.N)
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 President Glen Hauenstein said on Tuesday some of Southwest's customers are now up for grabs.
Some analysts also expressed concerns about its impact on the airline's brand. "We were not supporters of bag fees," said Savanthi Syth, an analyst at Raymond James.