Dieuwer
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Southwest vs. Wall Street

Fri Sep 21, 2018 6:43 pm

We all know that Southwest is not charging bag fees while everyone else does. The reason everyone else does - according to many A.netters - is that Wall Street forces the others to do so. Then why does Wall Street not force Southwest to start charging bag fees? After all, Southwest must "obviously" be leaving money on the table (which is bad Bad BAD to Wall Street).

Right?
 
evank516
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Re: Southwest vs. Wall Street

Fri Sep 21, 2018 6:57 pm

I remember seeing a thread on here, or maybe it was an article about the back and forth between Gary Kelly and Wall Street regarding their lack of fees. Gary just won't budge which is not a bad thing. B6 was semi-decent about their fees until Robin Hayes stepped in.
 
BoeingGuy
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Re: Southwest vs. Wall Street

Fri Sep 21, 2018 7:06 pm

Wall Street doesn't force any company to do anything. Good on WN. These fees are getting to be a joke, along with stuff like 30" seat pitch on 6 hour flights.
 
Flyingstump
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Re: Southwest vs. Wall Street

Fri Sep 21, 2018 7:09 pm

Up until very recently, the decision by Southwest not to charge for bags was driven by the fact that their system did not allow them to charge for bags (effectively, at least). This may change in the future, but for right now, they have crafted a brand/image of low fares, low/no fees. (Even though their fares aren't necessarily the lowest anymore).
 
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william
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Re: Southwest vs. Wall Street

Fri Sep 21, 2018 7:16 pm

The pressure to add baggage fees is heavy, just from the margins they would generate. CEO Kelly so far has resisted though SWA has fees for priority boarding. But what about the next CEO, will he or she have the same stance? SWA's seasoned work force is getting expensive and its feeling yield pressures from the ULCCs and majors as they ape the ULCC on certain fares.
 
MIAFLLPBIFlyer
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Re: Southwest vs. Wall Street

Fri Sep 21, 2018 7:20 pm

Flyingstump wrote:
Up until very recently, the decision by Southwest not to charge for bags was driven by the fact that their system did not allow them to charge for bags (effectively, at least). This may change in the future, but for right now, they have crafted a brand/image of low fares, low/no fees. (Even though their fares aren't necessarily the lowest anymore).


They're almost never the lowest fare but so many people who are non-aviation folks in south Florida tell me they still prefer WN (unless they are AA or B6 status fliers or premium coast-to-coast people meaning against AA or B6) because of the peace of mind of flying them even for more money. Change fees limited, no worry about stuffing things into carry ons, generally friendly flight crew etc. It's not my view necessarily but I hear too often in the Miami/Fort Lauderdale area from random people to ignore it.
 
msycajun
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Re: Southwest vs. Wall Street

Fri Sep 21, 2018 8:09 pm

Right now they can charge higher fares because of the lack of fees. Allowing bags also speeds up the boarding process. If they added bag and change fees, they'd have to lower their fares to match other airlines, so the gains would be minimal, but the increase in complexity in the booking, check-in, and boarding processes would be substantial.
 
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CarlosSi
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Re: Southwest vs. Wall Street

Fri Sep 21, 2018 8:16 pm

It won’t be that way forever. Just a change in administration would do it. I would hope checks and balances would prevent a CEO from just changing things tyrannically.

I wouldn’t mind if they eventually implemented bag fees if they had no choice due to economical pressures. There’s more to Southwest than free bags; there’s transFAREncy
 
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par13del
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Re: Southwest vs. Wall Street

Fri Sep 21, 2018 8:18 pm

Is it that WN fares are no longer the lowest or the US3 went into Chpt.11 to reduce their cost of business so that they could lower their fares to match WN?
If WN were to follow suit the status quo would be restored, unfortunately the US3 ensured that the Chpt.11 laws were changed, so.....
 
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lightsaber
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Re: Southwest vs. Wall Street

Fri Sep 21, 2018 8:19 pm

msycajun wrote:
Right now they can charge higher fares because of the lack of fees. Allowing bags also speeds up the boarding process. If they added bag and change fees, they'd have to lower their fares to match other airlines, so the gains would be minimal, but the increase in complexity in the booking, check-in, and boarding processes would be substantial.

The issue is search engines that only sort by lowest fare... WN has avoided that game. For now...

I want a search engine that allows sorting by fare with check boxes for assigned seat, minimum 32" pitch, bag (or not), BoB, snacks, and a small dog.

Today I have to go to 3+ web sites to compare the real fares. Prices are opaque to the service. Oh, as an a.nutter I know the difference, but people like my parents only look at Delta and Southwest as they do not want a surprise and they know DL's fare levels.

Lightsaber
IM messages to mods on warnings and bans will be ignored and nasty ones will result in a ban.
 
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FA9295
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Re: Southwest vs. Wall Street

Fri Sep 21, 2018 8:37 pm

lightsaber wrote:
msycajun wrote:
Right now they can charge higher fares because of the lack of fees. Allowing bags also speeds up the boarding process. If they added bag and change fees, they'd have to lower their fares to match other airlines, so the gains would be minimal, but the increase in complexity in the booking, check-in, and boarding processes would be substantial.

The issue is search engines that only sort by lowest fare... WN has avoided that game. For now...

I want a search engine that allows sorting by fare with check boxes for assigned seat, minimum 32" pitch, bag (or not), BoB, snacks, and a small dog.

Today I have to go to 3+ web sites to compare the real fares. Prices are opaque to the service. Oh, as an a.nutter I know the difference, but people like my parents only look at Delta and Southwest as they do not want a surprise and they know DL's fare levels.

Lightsaber

Google flights has been adding more things like that, such as differentiating basic economy with main cabin, and they're apparently going to update a feature with added baggage fees soon, as well... Wouldn't be surprised to see seat pitch be on the next update as well...
 
jetblueguy22
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Re: Southwest vs. Wall Street

Fri Sep 21, 2018 8:47 pm

When it comes to the WN bag fees discussion I always think about how their boarding process and EarlyBird helps them keep the no bag fees. I say this because last time I flew with them nearly the entire A Boarding process was EarlyBirds. I was A60 and I bought a ticket last minute.

Does 60 people buying early bird eliminate what the revenue they’d get from bags? I’d bet no. But it’s one fee they do have that helps them avoid charging for checked bags. I would be very interested to see the sales on EaryBird compared to Sky on DL and other airlines
Look at sweatpants guy. This is a 90 million dollar aircraft, not a Tallahassee strip club
 
airzona11
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Re: Southwest vs. Wall Street

Fri Sep 21, 2018 8:52 pm

WN has stated they think they earn more in business from those who choose to fly them because of the no bag fees vs what they would earn in bag fees, or something of the sort. Sure there is fluff in there, but it is a differentiator.
 
stlgph
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Re: Southwest vs. Wall Street

Fri Sep 21, 2018 9:14 pm

Dieuwer wrote:
We all know that Southwest is not charging bag fees while everyone else does. The reason everyone else does - according to many A.netters - is that Wall Street forces the others to do so. Then why does Wall Street not force Southwest to start charging bag fees? After all, Southwest must "obviously" be leaving money on the table (which is bad Bad BAD to Wall Street).

Right?


It's about the "long" position, as investors look back at the "long" history of the carrier's success and management, and see no need to put down the pressure for a short game.

Of course, that entire sentence just went right over your head.
if assumptions could fly, airliners.net would be the world's busiest airport
 
ericm2031
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Re: Southwest vs. Wall Street

Fri Sep 21, 2018 9:22 pm

Wall Street for the most part has backed off although they usually get 1 person per quarterly call to bring it up. They’ve calculated it would be about $1B in revenue, but are figuring they are getting that back in extra business by not charging...although that can’t be actually calculated. As long as they keep producing great results, I doubt anyone is going to question how they’re running their business. They have an unbeatable track record to back it up
 
PlanesNTrains
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Re: Southwest vs. Wall Street

Fri Sep 21, 2018 9:25 pm

WN fares often aren’t the lowest but they often are a good value as an overall package. Book and go. No Basic Econ/Econ/Prem Econ/seat assignment at gate/bag fees - just book and go. Sometimes they meet my needs and sometimes they don’t, but having a no-bag-fee option is nice.
-Dave


MAX’d out on MAX threads. If you are starting a thread, and it’s about the MAX - stop. There’s already a thread that covers it.
 
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exFWAOONW
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Re: Southwest vs. Wall Street

Fri Sep 21, 2018 9:32 pm

msycajun wrote:
Right now they can charge higher fares because of the lack of fees. Allowing bags also speeds up the boarding process. If they added bag and change fees, they'd have to lower their fares to match other airlines, so the gains would be minimal, but the increase in complexity in the booking, check-in, and boarding processes would be substantial.

:checkmark: Why piss off your customer base and charge bag fees just to appease a bunch of whiny day traders?
Is just me, or is flying not as much fun anymore?
 
slcdeltarumd11
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Re: Southwest vs. Wall Street

Fri Sep 21, 2018 9:45 pm

WN has sold themselves as more of a full-service airline. They have spent alot on marketing and it's their product differentiator at this point.

Let's face it WN gets higher fares than a lot of airlines on routes because they have a very loyal fan base and people know they get alot more value so they are willing to pay more. I am not sure WN would really undo it at this point. It would be a massive shift for them.

Southwest has so many years of consistency to back up that they know what they are doing.
 
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EA CO AS
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Re: Southwest vs. Wall Street

Fri Sep 21, 2018 10:21 pm

william wrote:
SWA's seasoned work force is getting expensive and its feeling yield pressures from the ULCCs and majors as they ape the ULCC on certain fares.


Also, remember that outside their hubs or focus cities, most majors have contracted out below-wing services like baggage handling to comparatively inexpensive vendors, while WN employs their own rampers at full union contract rates. ULCCs use vendors for below-wing services at all stations, I believe.

So again, not only is WN's workforce either at or near the top of the industry in terms of pay, but they have regular union employees doing the baggage handling.
"In this present crisis, government is not the solution to our problem - government IS the problem." - Ronald Reagan

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Tugger
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Re: Southwest vs. Wall Street

Fri Sep 21, 2018 10:30 pm

The ONLY thing I can see Southwest doing is MAYBE charging a nominal fee for the second bag ($20?). But even that I doubt. As others have pointed out you would piss off a certain set of customers and I doubt the revenue would outweigh the bad press and upset customer base.

Tugg
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Austin787
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Re: Southwest vs. Wall Street

Fri Sep 21, 2018 10:37 pm

Southwest doesn't charge checked bag fees, and they are consistently profitable. Why fix something that isn't broken?
 
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william
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Re: Southwest vs. Wall Street

Fri Sep 21, 2018 11:27 pm

ericm2031 wrote:
Wall Street for the most part has backed off although they usually get 1 person per quarterly call to bring it up. They’ve calculated it would be about $1B in revenue, but are figuring they are getting that back in extra business by not charging...although that can’t be actually calculated. As long as they keep producing great results, I doubt anyone is going to question how they’re running their business. They have an unbeatable track record to back it up


That's why it comes up at ever investor meeting. Fees are taxed differently too, which makes them appealing. Investors are probably thinking if SWA charge bag fees, profit margins will be in the 20% range.
 
bob75013
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Re: Southwest vs. Wall Street

Fri Sep 21, 2018 11:39 pm

Dieuwer wrote:
We all know that Southwest is not charging bag fees while everyone else does. The reason everyone else does - according to many A.netters - is that Wall Street forces the others to do so. Then why does Wall Street not force Southwest to start charging bag fees? After all, Southwest must "obviously" be leaving money on the table (which is bad Bad BAD to Wall Street).

Right?


Wall Street "forces" (actually investors force) companies with crappy financial results to get better by forcing share prices down. Southwest already has the best operating and net margins in the industry (yeah, even better than Delta), so there's little pressure on Southwest from either investors or Wall Street.

https://farm1.staticflickr.com/848/2978 ... f62d_b.jpg

Besides every time the other airlines up their fees, the transferency angle brings more pax to Southwest.
 
FlyingSicilian
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Re: Southwest vs. Wall Street

Sat Sep 22, 2018 12:24 am

MIAFLLPBIFlyer wrote:
Flyingstump wrote:
Up until very recently, the decision by Southwest not to charge for bags was driven by the fact that their system did not allow them to charge for bags (effectively, at least). This may change in the future, but for right now, they have crafted a brand/image of low fares, low/no fees. (Even though their fares aren't necessarily the lowest anymore).


They're almost never the lowest fare but so many people who are non-aviation folks in south Florida tell me they still prefer WN (unless they are AA or B6 status fliers or premium coast-to-coast people meaning against AA or B6) because of the peace of mind of flying them even for more money. Change fees limited, no worry about stuffing things into carry ons, generally friendly flight crew etc. It's not my view necessarily but I hear too often in the Miami/Fort Lauderdale area from random people to ignore it.


This is very common to hear in Texas and Oklahoma as well. There are a few people and business I know and work with who are almost cult-like with their affection and affinity for Southwest. that is not a bad thing per se (I fly them on short hops on rare occasion and they are fine.) but these people are adamant that Southwest must have the lowest fare. I have consulted with companies that automatically book at Southwest (without a contract and without checking others) presuming them to be the cheapest.

I have heard literally scores of people utter phrases like. wow now I can go to Costa Rica (or Belize, or Mexico) because Southwest finally flies there. Southwest is very good at the marketing game and have a very loyal pax base in many areas. The bag fees aspect is a big part of that IMO and one sees it often in the marketing in these areas.
“Without seeing Sicily it is impossible to understand Italy.Sicily is the key of everything.”-Goethe "Journey to Italy"
 
alggag
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Re: Southwest vs. Wall Street

Sat Sep 22, 2018 12:35 am

MIAFLLPBIFlyer wrote:
Flyingstump wrote:
Up until very recently, the decision by Southwest not to charge for bags was driven by the fact that their system did not allow them to charge for bags (effectively, at least). This may change in the future, but for right now, they have crafted a brand/image of low fares, low/no fees. (Even though their fares aren't necessarily the lowest anymore).


They're almost never the lowest fare but so many people who are non-aviation folks in south Florida tell me they still prefer WN (unless they are AA or B6 status fliers or premium coast-to-coast people meaning against AA or B6) because of the peace of mind of flying them even for more money. Change fees limited, no worry about stuffing things into carry ons, generally friendly flight crew etc. It's not my view necessarily but I hear too often in the Miami/Fort Lauderdale area from random people to ignore it.


I'm well aware that I can probably get a cheaper fare on another airline but WN is still my go to when they're an option. To me their biggest selling point is the flexibility to cancel or reschedule without penalty (just pay the fare difference or even get a credit if your new flights are cheaper) and I am willing to pay a premium for that peace of mind and simplicity. I'm not totally loyal though as I will book with somebody else if WN is just charging way too much or has poor timings.
 
presidential
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Re: Southwest vs. Wall Street

Sat Sep 22, 2018 12:37 am

I fly Southwest and find them to be cheaper (when you book ahead), especially when I am flying a family of 6.

* No bag fees
* No change fees
* No preferred seating fees
* No window seat fees

Only pain in the butt in Houston is flying out of Hobby.
 
jetblueguy22
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Re: Southwest vs. Wall Street

Sat Sep 22, 2018 2:33 am

Austin787 wrote:
Southwest doesn't charge checked bag fees, and they are consistently profitable. Why fix something that isn't broken?

Because they could be leaving money on the table? I’m not saying they should or it’s right, but if they are in the business of making money. Just like everyone else
Look at sweatpants guy. This is a 90 million dollar aircraft, not a Tallahassee strip club
 
LAXBUR
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Re: Southwest vs. Wall Street

Sat Sep 22, 2018 2:52 am

Southwest appeals to the masses for their lenient policies and their “people’s airline” vibe. If they start unbundling (bag fees) this could alienate some folks. Outside of early boarders everyone gets the same service. They’ve also managed to “trick” less savvy travelers with the idea WN is always the least expensive. I know plenty of folks that book with WN without checking anyone else. And others of course intentionally book with WN even at a higher fare because of the flexibility.
 
737tanker
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Re: Southwest vs. Wall Street

Sat Sep 22, 2018 3:42 am

Flyingstump wrote:
Up until very recently, the decision by Southwest not to charge for bags was driven by the fact that their system did not allow them to charge for bags (effectively, at least). This may change in the future, but for right now, they have crafted a brand/image of low fares, low/no fees. (Even though their fares aren't necessarily the lowest anymore).

I always find it strange that people say the WN reservation doesn't easily allow charging for bags when that same system has always easily allowed the 3rd, 4th, 5th or more bags to be charge for. So it must be a strange system that can charge for more than 2 bags but can't charge for any bags under 3.
 
PlanesNTrains
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Re: Southwest vs. Wall Street

Sat Sep 22, 2018 4:10 am

737tanker wrote:
Flyingstump wrote:
Up until very recently, the decision by Southwest not to charge for bags was driven by the fact that their system did not allow them to charge for bags (effectively, at least). This may change in the future, but for right now, they have crafted a brand/image of low fares, low/no fees. (Even though their fares aren't necessarily the lowest anymore).

I always find it strange that people say the WN reservation doesn't easily allow charging for bags when that same system has always easily allowed the 3rd, 4th, 5th or more bags to be charge for. So it must be a strange system that can charge for more than 2 bags but can't charge for any bags under 3.


I think the conclusion of that argument was that they “could” charge for bags but that it was a cumbersome system not set up for such large volumes of handling. I’m open to correction on that.
-Dave


MAX’d out on MAX threads. If you are starting a thread, and it’s about the MAX - stop. There’s already a thread that covers it.
 
luv2cattlecall
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Re: Southwest vs. Wall Street

Sat Sep 22, 2018 5:28 am

jetblueguy22 wrote:
When it comes to the WN bag fees discussion I always think about how their boarding process and EarlyBird helps them keep the no bag fees. I say this because last time I flew with them nearly the entire A Boarding process was EarlyBirds. I was A60 and I bought a ticket last minute.

Does 60 people buying early bird eliminate what the revenue they’d get from bags? I’d bet no. But it’s one fee they do have that helps them avoid charging for checked bags. I would be very interested to see the sales on EaryBird compared to Sky on DL and other airlines




Plus they recently raised EB to $20/$25 on most routes, which means even more revenue.
 
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seabosdca
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Re: Southwest vs. Wall Street

Sat Sep 22, 2018 5:39 am

presidential wrote:
* No window seat fees


But this really isn't true anymore, and I think it's a clever way of pulling the wool over people's eyes. On many routes you pretty much have to buy a Business Select fare or Early Bird to not have a center seat.

I'd rather have a bag fee than a no-center-seat fee.
 
santi319
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Re: Southwest vs. Wall Street

Sat Sep 22, 2018 6:24 am

seabosdca wrote:
presidential wrote:
* No window seat fees


But this really isn't true anymore, and I think it's a clever way of pulling the wool over people's eyes. On many routes you pretty much have to buy a Business Select fare or Early Bird to not have a center seat.

I'd rather have a bag fee than a no-center-seat fee.

I agree, I cant stand flying on WN, its just cramped and boarding is a mess. I really dont get whats the big deal about paying for a bag? Like you just pay it and move on. At least I can chose a seat in a window towards the area of the plane I like in other carriers.

The only thing I have to say about WN that beats everyone is their flight crews, which are obviously the best paid so no surprise there...
 
Planeflyer
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Re: Southwest vs. Wall Street

Sat Sep 22, 2018 6:49 am

LUV the reliability and the flexibility. All of my people fly LUV. In fact I only hire in cities served by LUV.
 
7673mech
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Re: Southwest vs. Wall Street

Sat Sep 22, 2018 7:26 am

exFWAOONW wrote:
msycajun wrote:
Right now they can charge higher fares because of the lack of fees. Allowing bags also speeds up the boarding process. If they added bag and change fees, they'd have to lower their fares to match other airlines, so the gains would be minimal, but the increase in complexity in the booking, check-in, and boarding processes would be substantial.

:checkmark: Why piss off your customer base and charge bag fees just to appease a bunch of whiny day traders?


Because the whiny day traders have invested in your company and given you capital to operate?
 
Blerg
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Re: Southwest vs. Wall Street

Sat Sep 22, 2018 8:30 am

7673mech wrote:
exFWAOONW wrote:
msycajun wrote:
Right now they can charge higher fares because of the lack of fees. Allowing bags also speeds up the boarding process. If they added bag and change fees, they'd have to lower their fares to match other airlines, so the gains would be minimal, but the increase in complexity in the booking, check-in, and boarding processes would be substantial.

:checkmark: Why piss off your customer base and charge bag fees just to appease a bunch of whiny day traders?


Because the whiny day traders have invested in your company and given you capital to operate?


Capital to operate? I didn't know Southwest had liquidity issues in the past.
 
WNCrew
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Re: Southwest vs. Wall Street

Sat Sep 22, 2018 9:04 am

santi319 wrote:
seabosdca wrote:
presidential wrote:
* No window seat fees


its just cramped and boarding is a mess.

The only thing I have to say about WN that beats everyone is their flight crews, which are obviously the best paid so no surprise there...


Personally I fly other airlines in my off time, but I can say FACTUALLY that when compared to everyone but B6 economy, WN is not cramped. Certainly no more than AA, UA, DL (in fact there's generally more legroom on WN).

Also boarding is incredibly organized at WN vs the blobs of humanity you see everywhere else. It's odd that at carriers with assigned seats, one would have to jockey to get to the gate.

Thank you for the compliment as far as Crews, we have every reason to BE happy!
ALL views, opinions expressed are mine ONLY and are NOT representative of those shared by Southwest Airlines Co.
 
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par13del
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Re: Southwest vs. Wall Street

Sat Sep 22, 2018 12:28 pm

santi319 wrote:
I agree, I cant stand flying on WN, its just cramped and boarding is a mess.

Cramped in the boarding area or the a/c?
All 737's no RJ's and no 29 or 30" seat pitch, I stand to be corrected but I think their lowest is 31"

As for the boarding process, it is different and unique, so in some eyes different things can be a mess.
 
AWACSooner
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Re: Southwest vs. Wall Street

Sat Sep 22, 2018 1:39 pm

slcdeltarumd11 wrote:

Southwest has so many years of consistency to back up that they know what they are doing.

Let's recap:
1. Fares that are consistently as low as (if not, slightly higher) than the big 3's Economy Minus fares.
2. DECADES of quarterly profits
3. NEVER had to hide behind Chapter 11 to cover for their financial/manegerial stupidity


If I'm a customer and a shareholder, I'm feeling pretty happy with those...yes, they're obviously leaving $$ on the table with the two bags free and no change fees, but they've found a sweet spot that somehow is appeasing both interested parties. And I'm ok with that.
 
bobd6
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Re: Southwest vs. Wall Street

Sat Sep 22, 2018 2:05 pm

seabosdca wrote:
presidential wrote:
* No window seat fees


But this really isn't true anymore, and I think it's a clever way of pulling the wool over people's eyes. On many routes you pretty much have to buy a Business Select fare or Early Bird to not have a center seat.


I've probably flown over 50 segments either to or from Southwest's largest station and never had a center seat, unless by choice. As long as you check-in right at T-24h and are at the gate on time it won't be an issue. I love that about Southwest. The zero 'bull' fees and easy rewards are worth a lot to a lot of Southwest flyers, me included.
 
tphuang
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Re: Southwest vs. Wall Street

Sat Sep 22, 2018 2:08 pm

As long as WN delivers the results, Wall Street can't force them to do anything.
 
amdiesen
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Re: Southwest vs. Wall Street

Sat Sep 22, 2018 2:43 pm

tphuang wrote:
As long as WN delivers the results, Wall Street can't force them to do anything.


Besides, during the next downturn the influence will shift to Farnam street
 
Cubsrule
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Re: Southwest vs. Wall Street

Sat Sep 22, 2018 3:36 pm

bobd6 wrote:
seabosdca wrote:
presidential wrote:
* No window seat fees


But this really isn't true anymore, and I think it's a clever way of pulling the wool over people's eyes. On many routes you pretty much have to buy a Business Select fare or Early Bird to not have a center seat.


I've probably flown over 50 segments either to or from Southwest's largest station and never had a center seat, unless by choice. As long as you check-in right at T-24h and are at the gate on time it won't be an issue. I love that about Southwest. The zero 'bull' fees and easy rewards are worth a lot to a lot of Southwest flyers, me included.


I can think of one my flight at my station (Monday morning originator to DAL) where A-list frequently spills into B. It’s conceivable that Early Bird fills up most of the rest of B. But that is the exception, not the rule. I buy Early Bird for the family (usually on WGA fares with some but not a ton of advance purchase) and they average A45 or so on the first flight of the trip.
I can't decide whether I miss the tulip or the bowling shoe more
 
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AirlineCritic
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Re: Southwest vs. Wall Street

Sun Sep 23, 2018 8:49 am

william wrote:
The pressure to add baggage fees is heavy, just from the margins they would generate. CEO Kelly so far has resisted though SWA has fees for priority boarding. But what about the next CEO, will he or she have the same stance?


There's an unmistakable stench of only-one-business-model-makes sense in the above :-)

I agree that new CEOs or other management changes may change things in the future.

But my perception is that SWA has positioned itself as the friendly-and-no-surprises airline in the view of their customers. With a pretty efficient boarding process to boot. You can't necessarily go from that to friendly-but-with-surprises-and-everyone-searches-for-space-for-their-oversize-carryon -business model :-) You might have to jump right to lowest-base-prices-but-we-screw-you-in-all-possible-ways model, but that's already a well occupied segment.

william wrote:
SWA's seasoned work force is getting expensive and its feeling yield pressures from the ULCCs and majors as they ape the ULCC on certain fares.


No argument there, business is difficult and there's competition. Doesn't follow that everyone must have the same business model.
 
MCIRNO
Posts: 61
Joined: Mon May 14, 2018 2:49 pm

Re: Southwest vs. Wall Street

Sun Sep 23, 2018 2:51 pm

par13del wrote:
santi319 wrote:
I agree, I cant stand flying on WN, its just cramped and boarding is a mess.

Cramped in the boarding area or the a/c?
All 737's no RJ's and no 29 or 30" seat pitch, I stand to be corrected but I think their lowest is 31"

As for the boarding process, it is different and unique, so in some eyes different things can be a mess.


I was thinking the same thing about RJs or the tight seat pitch on the rest. Also, if my memory serves me correct, wasn't there several articles and sections on this board complaining about AA's 737 MAXs? Or that their CEO thinks that fares should be double? Or UA CEO thinking that families should pay to sit together? Quite honestly, I think they're making it EASY on WN's marketing department. During this (American) football season, it wouldn't surprise me that WN comes out with an ad campaign bashing all of the majors $5 baggage fee increase.

As for the boarding process, I just laugh because the other carriers do ***exactly*** what WN does but with different names:
UA's new and improved, revamped for the 3rd time in 3 years approach: https://www.united.com/web/en-US/conten ... ocess.aspx
DL: https://www.delta.com/content/www/en_US ... ority.html
Or AA's 9 boarding groups: https://www.aa.com/i18n/travel-info/boa ... rocess.jsp

One last thing, everyone on this board also agrees that the wonderful baggage fees have made people try to carry-on much larger bags, right? That slows down the boarding process quite a bit, which in turn causes delays and burning excess fuel...why isn't Wall Street worried about those costs too?
 
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lightsaber
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Re: Southwest vs. Wall Street: Bag fees

Sun Sep 23, 2018 2:56 pm

Dieuwer wrote:
We all know that Southwest is not charging bag fees while everyone else does. The reason everyone else does - according to many A.netters - is that Wall Street forces the others to do so. Then why does Wall Street not force Southwest to start charging bag fees? After all, Southwest must "obviously" be leaving money on the table (which is bad Bad BAD to Wall Street).

Right?
IM messages to mods on warnings and bans will be ignored and nasty ones will result in a ban.
 
travaz
Posts: 853
Joined: Wed Jun 13, 2001 1:03 am

Re: Southwest vs. Wall Street

Sun Sep 23, 2018 5:36 pm

If you do a quick fare search you will find WN is often higher. I looked at PHX MCI nonstop. AA total RT lowest fare was $324.00. WN total RT was $398.00. Take AA and add in $50.00 for bag fees and AA is still cheaper. I always contended that WN just built the bag fee into the fare. I fly out of PHX and use AA most of the time. I wonder how many PAX have minimal status (like I do with Gold) and don't pay the fee for baggage. I often use WN for short flights around the west (LAS, LAX, SAN ETC) I rarely have more than a small carry on bag (that fits under the seat) so in most cases the bag fee is irrelevant to me. IMHO one of the smart things WN has done is tightly control their fare availability so you can't compare side by side. Most people have a budget in mind and if the WN fare is in that range they look no further. WN may at some point may start to charge for bags but at the moment the bags fly free is good marketing tool. I can see the NFL ad campaign now. Airline ABC flyer having a ref throw a flag and asses a $5 fee increase for having a bag, Should be humorous.
 
Miamiairport
Posts: 219
Joined: Tue Apr 10, 2018 8:14 pm

Re: Southwest vs. Wall Street

Sun Sep 23, 2018 6:54 pm

I give WN management credit for not bowing down to Wall Street whims for years. But if profit growth ever slips that becomes problematic. I have to wonder when Private Equity will come calling with a deal for shareholders. Then it’s all over.
 
FlyHappy
Posts: 1042
Joined: Sat May 13, 2017 1:06 pm

Re: Southwest vs. Wall Street

Sun Sep 23, 2018 9:42 pm

Planeflyer wrote:
LUV the reliability and the flexibility. All of my people fly LUV. In fact I only hire in cities served by LUV.


My friend, you take the cake for loyalty.
Though honestly, how many cities are there with possible candidates/clients (whatever biz you're in) that aren't served by LUV?
 
ShinyAndChrome
Posts: 189
Joined: Fri Aug 28, 2015 1:53 am

Re: Southwest vs. Wall Street

Sun Sep 23, 2018 10:56 pm

Miamiairport wrote:
I give WN management credit for not bowing down to Wall Street whims for years. But if profit growth ever slips that becomes problematic. I have to wonder when Private Equity will come calling with a deal for shareholders. Then it’s all over.


With WN's market cap and profitability a PE deal would be prohibitively expensive for the uncertain upside it would entail.

In any case, even the most activist investor isn't going to bother making this bag fee situation a real sticking point so long as WN's underlying business is doing well. As long as WN performs well, investors will happily defer to Gary Kelly and the rest of management's claims on the upside of their current approach, hard as it may be to qualify that.

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