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The Street
The Street
Daniel Kline

Southwest Airlines quietly gets ready to make a huge change

Southwest Airlines has always been the T-Mobile of its space, albeit with a bit less arrogance. 

The company has been an intentional disruptor that likes to do things differently than the industry norms.

That hasn't helped passengers in the same way T-Mobile doing things like dropping overage charges and ending long-term contracts did for mobile-phone users. That's largely because most customers can choose among the three major phone carriers and still have a good experience.

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Air travel does not work that way. You may want to fly Southwest Airlines LUV because it offers free checked bags and few add-on charges. 

But if the only direct flights from the airport near where you live to your destination are from another carrier, well, most people will put up with higher prices, pay for checked bags, and accept the other fees associated with Delta, American and United Airlines.

The same logic applies to itineraries. Southwest may fly the route that gets you to your destination, but it may not fly it as often as its rivals do. In addition, the Southwest flight that gets you where you're going may have stops and layovers or get you in later than you want.

Southwest, unlike its major rivals, has not scheduled red-eye flights. Those flights leave at night and arrive the next morning. Red-eye flights are popular — at least for people who can sleep on planes — because they give passengers more time at their destination.

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Red eye flights usually arrive early in the morning.

Image source: Getty Images.

Southwest Airlines CEO talks about red-eye flights 

Traditionally, Southwest has not offered red-eye flights.

"Up until 2017, there was a technical limitation that prevented Southwest Airlines from scheduling red-eyes. The airline used to have an antiquated reservations system," One Mile at a Time reported.

That has not been the case for the past five years, but the airline has not yet made the change. The reason, the website added, might be that the airline's contract with its pilots would make the flights more expensive to run.

Southwest and its pilots are currently at a contract impasse. The two sides remain in federal mediation and it's certainly possible that a new contract will clear the way for red-eye flights. 

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Chief Executive Bob Jordan addressed the topic of red-eye flights in a recent interview with the Dallas Morning News.

“It’s a logical evolution for us,” Jordan said, noting that Southwest already has the aircraft and the customer demand for red-eye flights, and it’s just a matter of time before the airline expands operations to include red-eyes.

They would likely start with flights into or out of its home base at Love Field in Dallas. 

Southwest is making major schedule changes

Before it adds red-eye flights, Jordan says, his company needs to make some schedule changes.  

"As we shared this morning in our release, we are revamping our 2024 flight schedules. While our network is largely restored at this point, it is not optimized, especially for post-pandemic shifts in business travel," he said.

Business travel has slowed for not just Southwest but the overall industry, while leisure travel has generally filled in the demand.

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"Those adjustments to the network will be largely complete by the March 2024 flight schedules, and we expect those efforts and the continued maturation of development markets to generate an incremental $500 million in pretax profit in 2024," he added. 

"The changes will also reduce the percentage of system capacity and development by more than half, returning to normal prepandemic levels by the end of next year."

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