Southwest airport lounges? CEO says carrier is open to even more high-end changes

CNBC

11 hours ago

ARLINGTON, Texas — Southwest Airlines is considering airport lounges, more premium seating and even long-haul international flights to win over high-spending customers, CEO Bob Jordan said Wednesday.
"Whatever customers need in 2025, 2030, we won't take any of that off the table. We'll do it the Southwest way but we're not going to say 'We would never do that,'" Jordan said in an interview with CNBC at an airport industry conference. "We know we send customers to other airlines because there's some things you might want that you can't get on us. That includes things like lounges, like true premium, like flying long-haul international."
Southwest is in the middle of a transformation. That has included undoing some of its policies like open seating, a uniform cabin and allowing all customers to check two bags for free, things that had set it apart from rivals in much of its 54 years of flying.
But it has faced pressure from competitors, and an activist investor last year pushed the carrier to increase revenue. And airfare in the U.S. has dropped.
Southwest and other carriers pulled their 2025 forecasts earlier this year, citing economic uncertainty. Jordan said Wednesday that the airline is continuing to see cheaper fares.
"The summer is generally never on sale, and the summer is heavily on sale right now," he said.
Despite making major changes to its business model, Jordan said the carrier hasn't seen customers defect to other carriers since it introduced no-frills basic economy tickets and bag fees late last month, policies rivals already had.
But making changes at the high end is important, too, he said.
Competitors like Delta Air Lines, United Airlines and American Airlines have added more luxury tourism destinations and roomier, more expensive seats, and they've also invested heavily in airport lounges. For example, earlier Wednesday, American unveiled plans to nearly double its lounge space at its Miami International Airport hub.
Jordan said it's "way too soon to put any specifics" on potential changes, but he called out Southwest stronghold Nashville International Airport — where the airline has a more than 50% market share, according to airport data — as a place where customers are hungry for luxury.
"Nashville loves us, and we know we have Nashville customers that want lounges. They want first class. They want to get to Europe and they're going to Europe," he said.
But getting those things means those customers have to book on another airline, which could make them more likely to add that rival's co-branded credit card to their wallets, too, he said.
"I want to send fewer and fewer customers to another airline," he said.
Jordan said it's also too early to say whether Southwest will make the shift to buying longer-haul aircraft, which it would need to go to Europe; it's relied on the Boeing 737 for more than half a century. Southwest has been forging international partnerships — Icelandair and China Airlines, so far— but a Southwest plane landing in Europe at some point is on the table, he said.
"No commitment, but you can certainly see a day when we are as Southwest Airlines serving long-haul destinations like Europe," he said. "Obviously you would need a different aircraft to serve that mission and we're open to looking at what it would take to serve that mission."
In the nearer term, Southwest is still awaiting deliveries of Boeing 737 Max 7s, the smallest plane in the Max family, which still hasn't won Federal Aviation Administration certification. Jordan said the manufacturer has made progress with more consistent deliveries recently, but Southwest doesn't expect to fly the Max 7 in 2026.