After more than 50 years of "two bags fly free," Southwest Airlines will start charging certain customers bag fees, the airline announced Tuesday.
The change comes after months of executives promising to not eliminate the airline's famous perk, with CEO Bob Jordan in a July earnings call saying after bags fly free is cited among the No. 1 reason why customers choose Southwest.
But it also comes after months of pressure from activist Elliott Investment Management.
The firm took a stake in the airline last year, CNBC reported. It also won five board seats as it pushed for quick changes at the company, which held on for decades — until now — to perks like free checked bags, changeable tickets and open seating.
Extra legroom, assigned seats, overnight flights: Inside Southwest Airlines' plan for its future
"Two bags fly free" is a registered trademark on Southwest's website, CNBC's report said. But its decision to about-face on what executives long cast as a sacrosanct passenger perk brings the largest U.S. domestic carrier in line with its rivals, which together generated $5.5 billion from bag fees last year, according to federal data.
In a message to customers Tuesday, Jordan said the bag changes come as the airline has a "tremendous opportunity to meet current and future Customer needs, attract new Customer segments we don't compete for today, and return to the levels of profitability that both we and our Shareholders expect."
According to the Tuesday announcement, some Southwest Airlines customers may be subject to bag fees, depending on their Rapid Rewards status. Others will be charged for their first and second bags, starting later this year.
With the bag change soon going into effect, here's what we know now, and what customers the changes will impact.
Will all Southwest Airlines customers be charged bag fees?
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Southwest will continue to offer two free checked Rapid Rewards, A-List Preferred Members and Customers traveling on Business Select fares, the announcement said. The airline will also offer one free checked bag to A-List Members and other select customers, the announcement added.
For Rapid Rewards Credit Cardmembers, Southwest will provide a credit for one checked bag.
"Customers who do not qualify for these free bag options will be charged for their first and second checked bags," Southwest said.
When does the change go into effect?
Changes will apply to flights booked on or after May 28, 2025, Southwest said.
How much will bags cost?
Southwest did not elaborate on pricing of checked bags, and did not immediately respond to NBC Chicago's request for comment.
Southwest's new 'Basic Fare'
The airline also said Tuesday that it will launch a new, "Basic" economy fare, "in advance of offering assigned seating and extra legroom options."
The basic fare will be available for tickets purchased on or after Mary 28, ,2025, the airline said.
Rapid Reward, flight credit changes
Southwest will also change the way customers earn Rapid Rewards: Customers will earn more of the frequent flyer miles depending on how much they pay, the announcement said.cc Redemption rates will vary depending on flight demand, a dynamic pricing model competitors use.
Southwest also said flight credits for tickets for tickets purchased on or after May 28 will expire one year, or earlier, depending on the type of fare purchased.
