Southwest Airlines Is Losing Its Soul—And Its Competitive Marketing Edge

For decades, Southwest Airlines was the quirky, customer-friendly carrier that rewrote the rules of air travel. It won over millions of loyal passengers with its no-frills, low-cost model, featuring free checked bags, open seating, rapid boarding, and an easygoing, fun-loving company culture. It wasn’t just another airline—it was the people’s airline, offering affordable fares without nickel-and-diming customers like its competitors.

But that era has come to an end. In a bid to increase profitability and satisfy activist investors, Southwest Airlines is shedding the very policies that made it special. The two-free checked bags policy is gone, assigned seating is being introduced, premium seating options are on the way, and flights will now be listed on third-party platforms like Expedia and Google Flights. What was once a standout brand is now morphing into just another airline.

And the issue is, without business class, code-shares and any upper level services - how can they survive chaotic boardings, over stuffed bins and slow turn around?

How Southwest Built a Brand People Loved

Southwest wasn’t always the dominant force in low-cost travel. It started as a Texas-only airline in 1971, fighting off legal challenges from larger carriers that wanted to keep it out of the skies. But its formula—low fares, fast turnarounds, and friendly service—helped it expand beyond the Lone Star State, reaching national prominence in the 1990s and 2000s.

Unlike its rivals, Southwest stayed profitable for 47 consecutive years, avoiding the bankruptcies and bailouts that plagued other airlines. While legacy carriers made flying a miserable, fee-ridden experience, Southwest kept things simple:

Bags fly free—no gouging customers with baggage fees

No change fees—allowing flexibility without penalty

Open seating—giving passengers freedom in choosing their seats

Fast boarding and turnarounds—keeping flights on time

Great service—with a culture that embraced fun, humor, and customer care

These policies weren’t just perks—they were Southwest’s brand identity. They gave the airline a clear competitive edge, ensuring that even if its fares weren’t always the lowest, the overall value was unbeatable. Now, that advantage is gone.

What’s Driving the Change?

The shift at Southwest isn’t happening in a vacuum. The airline has faced major financial and public operational struggles over the past few years:

• A 2022 holiday meltdown left more than 15,000 flights canceled due to outdated scheduling systems, costing the airline over $1.1 billion and leading to a record $140 million fine from the Department of Transportation.

• A hedge fund, took advantage of Southwest’s weakened position, buying 10% of the airline and demanding changes to boost profits.

• A leadership shakeup followed, with longtime executive Gary Kelly stepping down and five new investor-backed board members joining the company.

• Facing pressure to cut costs and increase revenue, Southwest has abandoned many of its signature policies, including free checked bags, which had been a core part of its identity for decades.

  
  

Kind of sounds like Sears?

Southwest’s Risky Move: Trading Brand Loyalty for Short-Term Gains

With these sweeping changes, Southwest is risking its most valuable asset—customer loyalty. Unlike ultra-low-cost carriers like Spirit or Frontier, Southwest had built a trustworthy, customer-first reputation. Now, it’s eliminating the very features that kept travelers coming back.

• Checked bag fees will make Southwest just like every other airline. Free bags were a major selling point, helping customers justify paying slightly higher fares compared to budget carriers.

• Assigned seating erodes its “fun and fast” boarding process. For frequent Southwest flyers, open seating was a key differentiator—a faster, simpler way to board.

• Red-eye flights, premium seating, and basic fares blur the airline’s identity. Southwest once stood out by keeping things simple, but now it’s adopting the confusing, tiered pricing models of legacy airlines.

• Investor-driven changes rarely prioritize customers. The demands of hedge funds often lead to cost-cutting at the expense of service, which could ultimately drive away loyal passengers.

  
  

What Now?

Southwest’s transformation marks the end of an era, but will it work? In the short term, these changes will boost revenue, but in the long run, the airline could find itself in an identity crisis. Without its signature policies, what will make Southwest different from Delta, United, or American?

For travelers, the loss of free checked bags and open seating may push them to reconsider their options. If Southwest is no longer a standout in the industry, customers may simply choose the airline with the best price or schedule—even if it’s one they previously avoided.

Southwest was once the airline that broke the mold, proving that low-cost travel didn’t have to mean low service. But now, as it abandons its biggest brand advantages, it’s becoming just another airline in an already overcrowded sky.