Southwest revokes long-standing customer perk

Caroline Woods brings you the biggest news of the day, including why Southwest Airlines is changing its stance on free bags.

Transcript

00:00After nearly six decades of service, Southwest Airlines is officially getting rid of something its customers love, free checked bags.

00:08The airline announced it will begin charging for the first and second checked bag.

00:12On the decision, Southwest CEO Bob Jordan said,

00:15We have tremendous opportunity to meet current and future customer needs,

00:19attract new customer segments we don't compete for today,

00:22and return to the levels of profitability that both we and our shareholders expect.

00:27Free checked bags have been so synonymous with Southwest that the slogan,

00:31Bags Fly Free, became part of its advertising.

00:34Despite the mantra, Southwest brought in $73 million in baggage fees in 2023,

00:40according to the Department of Transportation.

00:42However, that pales in comparison to other airlines.

00:45American Airlines raked in $1.4 billion that same year,

00:49with Delta and United each collecting roughly $1 billion.

00:53Southwest's new baggage fees go into effect on May 28th.

00:57That'll do it for your daily briefing from the New York Stock Exchange.

01:00I'm Caroline Woods with The Street.