by Lacey Pfalz
Last updated: 9:40 AM ET, Thu July 25, 2024
In a major shift of customer experience, Southwest Airlines announced it would begin allowing customers to assign their seats following a disappointing second quarter and a new FAA safety audit into several recent near-miss incidents.
Needless to say, this summer has been a busy one for the airline.
The Federal Aviation Administration Audit
On July 24, the FAA announced it would place the airline under an enhanced safety review following the string of near-miss incidents this summer. The administration said, according to NBC News, that the investigation is to ensure the airline “is complying with federal safety regulations."
We’ve covered the news about the airline’s near-miss incidents. In April, a Southwest Airlines plane nearly crashed into the ocean off the coast of Kauai, which was attributed to a piloting error.
Another incident in June prompted a different FAA investigation when a plane heading into Oklahoma City flew dangerously low over the city while still several miles from the airport. It was about 525 feet above the ground.
And in mid-July, a Southwest Airlines plane heading for Tampa did the same thing, flying just 175 feet above the city, prompting yet another FAA investigation.
Southwest and Assigned Seating
In a surprising shift for many travelers, the airline announced this week that it had changed its policy concerning assigned seating and will begin planning to assign seats, offer more premium seating options and redesign its often chaotic boarding model as ways to enhance its customer experience and increase its future revenue.
The airline hasn’t assigned seats for over 50 years, yet Southwest’s data found that around 80-86 percent of fliers prefer assigned seats. Southwest expects the new cabin layout to begin in 2025 following regulatory approval by the FAA.
"Moving to assigned seating and offering premium legroom options will be a transformational change that cuts across almost all aspects of the Company," said Bob Jordan, President, CEO, & Vice Chairman of the Board. "Although our unique open seating model has been a part of Southwest Airlines since our inception, our thoughtful and extensive research makes it clear this is the right choice—at the right time—for our Customers, our People, and our Shareholders. We are excited to incorporate Customer and Employee feedback to design a unique experience that only Southwest can deliver. We have been building purposefully to this change as part of a comprehensive upgrade to the Southwest experience as we focus on Customer expectations – and it will unlock new sources of revenue consistent with our laser focus on delivering improved financial performance."
A Disappointing Second Quarter is Driving Change
Jordan said the airline “fell short” during the second quarter of the year in terms of its finances, though the airline reported an all-time quarterly record in operating revenue, at $7.4 billion.
RASM (revenue per available seat mile), another key aviation metric, is expected to remain flat or fall two percent during the third quarter. It fell 3.8 percent year-over-year during the second quarter of the year.
While all airlines have been offering higher capacities than needed this year, Southwest is planning to lower its capacity by 4 percent this winter, and seats and trips are expected to decline about 8 percent from the fourth quarter of 2023. Southwest expects to see positive unit revenue by the end of the year due to the capacity reduction.
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