Southwest Airlines Unveils Major Overhaul Amid Investor Pressure

The airline plans to end open seating, introduce premium options, and expand international partnerships to boost revenue and fend off activist hedge fund Elliott Management.

Southwest Airlines announced a comprehensive turnaround plan, aiming to generate $4 billion in incremental earnings by 2027.
Key changes include the introduction of assigned seating starting in 2026 and premium seating options with extra legroom.
The airline will maintain its popular policy of two free checked bags despite pressure to eliminate it.
Southwest plans to offer red-eye flights beginning in February 2025 and expand its network through international partnerships, starting with Icelandair.
The board authorized $2.5 billion in share buybacks and appointed former Spirit Airlines CEO Bob Fornaro to the board to address investor concerns.