Southwest Airlines (NYSE:LUV) is making major changes to its boarding policy as the air travel company is getting rid of open seating.
The end of open seating on Southwest Airlines flights marks a major shift in the airline’s more than 50-year history. Other changes include options for more expensive seats with additional legroom.
Southwest Airlines says that this change is to encourage customers to fly with it. A study conducted by the airline shows that open seating was the main reason that travelers chose its competitors.
It will still be some time before Southwest Airlines’ open seating is gone. That’s because the company will not offer the new seating option until sometime next year. It’s also introducing overnight flights to attract more customers.
Southwest Airlines Ends Open Seating Following Q2 Earnings
That’s despite the company’s adjusted EPS and revenue of 58 cents and $7.35 billion beating out estimates. Wall Street was looking for adjusted EPS of 51 cents alongside revenue of $7.34 billion.
Even with the beats, Southwest Airlines CEO Bob Jordan expects more from the company:
“Our second quarter performance was impacted by both external and internal factors and fell short of what we believe we are capable of delivering. Our goal is to restore industry-leading margins and historical levels of Shareholder returns through our comprehensive plan to deliver transformational commercial initiatives, improved operational efficiency, and capital allocation discipline.”
LUV stock is down 3.3% as of Thursday morning.
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On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.
