Southwest will implement assigned seats, ending the open-boarding policy that has been one of the airline's defining features.
Southwest will also redesign its cabins to add extra-legroom seats, which will encompass approximately one-third of all seats.
The airline expects to open bookings for the assigned-seating system sometime in 2025. The airline added that details about seating products -- including cabin layout, the timing of cabin conversions and how much incremental revenue will be generated -- will be provided at a September investor day event. Cabin reconfigurations will require FAA approval.
"Moving to assigned seating and offering premium legroom options will be a transformational change that cuts across almost all aspects of the company," CEO Bob Jordan said Thursday. "Although our unique open-seating model has been a part of Southwest Airlines since our inception, our thoughtful and extensive research makes it clear this is the right choice -- at the right time -- for our customers, our people and our shareholders. We are excited to incorporate customer and employee feedback to design a unique experience that only Southwest can deliver."
Southwest had telegraphed plans to begin assigning seats, as well as potential considerations for cabin reconfigurations, in late April. The moves have been spurred by the airline's underperformance financially compared to its primary competitors, especially United and Delta.
A consumer shift toward premium seats since the pandemic is a key reason for Southwest's anemic financial performance in recent years.
Southwest is also facing pressure from activist investment firm Elliott Management, which took an 11% stake in the company in June and called for commercial changes as well as the replacement of Jordan and board chairman Gary Kelly. Jordan refused to step down.
Southwest said Thursday that it has conducted over 8 million simulation-based boarding trials. In addition, airline research indicates that more 80% of its customers and 86% of potential customers prefer an assigned seat.
"When a customer elects to stop flying with Southwest and chooses a competitor, open seating is cited as the No. 1 reason for the change," the airline said. "By moving to an assigned-seating model, Southwest expects to broaden its appeal and attract more flying from its current and future customers."
Upending its boarding process and adding extra-legroom seats aren't the only initiatives Southwest announced Thursday.
Southwest will add red-eye flights
The carrier also unveiled a Valentine's Day 2025 launch date for its long-planned inception of red-eye flying. Tickets for the five initial redeye flights are now on sale. The routes include Las Vegas-Baltimore, Las Vegas-Orlando, Los Angeles-Baltimore, Nashville-Baltimore and Phoenix-Baltimore.
The airline plans to gradually phase in more overnight flights as part of a multiyear transformation to a 24-hour operation. Southwest said that the combination of red-eye flying and turn-time reduction will enable nearly all new capacity over the coming three years to be implemented without additional expenditures on aircraft.
To facilitate the various new commercial initiatives, Southwest has created a new position called executive vice president of transformation. Ryan Green, previously the carrier's chief commercial officer, has been tapped for the role.