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Southwest Airlines will end its long-standing policy of allowing passengers to check bags for free starting Wednesday (May 28). The airline will now charge $35 for the first checked bag and $45 for the second. This change marks the end of a decades-long policy that set Southwest apart from its competitors.
The new baggage fees apply to passengers who have not reached the upper tiers of Southwest's Rapid Rewards loyalty program, purchased a business class ticket, or hold the airline's credit card. However, Rapid Rewards A-List preferred members and Business Select fare customers will still receive two free checked bags, while A-List members and other select customers will get one free checked bag. Passengers with Rapid Rewards credit cards will receive a credit for one checked bag.
Southwest first announced the policy change in March, stating that it would begin with flights booked on Wednesday. The airline estimates that the new fees will generate approximately $1.5 billion annually, although it may lose $1.8 billion in business from customers who previously chose Southwest for its generous baggage policy.
In addition to the baggage fee changes, Southwest will implement a new policy requiring passengers to keep portable chargers in plain sight while in use due to concerns over lithium-ion battery fires. The airline also plans to introduce assigned seating next year, moving away from its traditional open-boarding system.
These changes come as Southwest faces pressure from activist investors to increase profits and revenue. The airline recently reached an agreement with Elliott Investment Management to avoid a proxy fight, resulting in several seats on the company's board for the hedge fund. In February, Southwest announced the elimination of 1,750 jobs, marking the first major layoffs in its 53-year history.