Southwest Airlines says it will introduce assigned seats and premium perks in 2026

Southwest Airlines executives on Thursday unveiled their vision for Southwest 2.0, an airline that for the first time will give passengers assigned seats, charge them extra for more legroom and offer red-eye flights. And bags still will fly free. The airline will also repackage its sale of vacation packages. It will seek partnerships with international airlines, starting with Icelandair next year, that executives say will make Southwest credit cards and frequent-flyer program more attractive. The changes will amount to the biggest ever at Southwest, which is the original low-cost airline but is now well into middle age and suffering from sagging financial results. Southwest executives pitched the new offerings as they came under increasing pressure from an activist investor who wants to replace the airline’s management and force a review of its strategy. Southwest’s annual profit is on pace to decline for a third straight year, and its stock price has fallen by more than half since early 2021. “Our model is not broken,” CEO Robert Jordan declared, but he said it needs tweaking and “enhancement.” “We are not producing the financial results that we are capable of delivering,” he said at a meeting with investors at the airline’s Dallas headquarters. Southwest said its multi-year plan, including changes to its flight network, will add about $1.5b in pretax earnings in 2027. Southwest had previously given the outlines of changes including assigned seating and extra-legroom seats, but it gave more details about them Thursday.<br/>