During the pandemic most U.S. airlines eliminated change fees on most tickets (excluding basic economy fares). That brough them closer in line with Southwest, which already didn’t have these fees – and also doesn’t charge extra for two checked bags per passenger.
The elimination of change fees makes it much easier to pull the trigger on buying a ticket. If you’re not sure your trip is going to happen, you can cancel and get a credit to use on a future trip. And if you’re wondering if fares might drop, you can call and get a credit for the difference if that happens.
Still, you generally need to be a frequent enough flyer to use that credit for this to help. And you need to be a frequent enough flyer of that airline for it to help. Credits will generally expire after a year, with the particulars depending on airline.
- This actually serves to keep me buying tickets from the airlines I fly most, since I want their credits and only their credits
- Credits on little-used carriers might go to waste, expiring unused
Now in a move that should make it even easier to buy Southwest Airlines tickets they’ve announced that their credits will never expire. All Southwest Airlines flight credits active starting today – however you’ll see a ‘placeholder’ expiration date of December 31, 2040 with tech updates later in the year eliminating the expiration date and process entirely.
This is expensive from a balance sheet perspective, they get to remove liabilities when credits expire and much of that goes away (though there will still be some breakage). But it’s going to be a real driver of business for them.
- People who don’t value a credit that’s useful within a year can rest easy
- Southwest’s credits won’t expire, so they’re more valuable – a person need only be able to use them at some point in the future of the universe
- This will be less expensive for them than you’d expect since already they made credits transferable to other people with their new Wanna Get Away Plus fares making those far more likely to be used
- It will be interesting to see how other airlines react, given that this move makes Southwest more competitive and they are the largest carrier of domestic passengers – of course other airlines didn’t match their policy that bags fly free.
Already American Airlines trip credits can be used for anyone, while flight credits can only be used by the named recipient (American is generally moving towards trip credits, and ran a promo where flight credits could be transferred between AAdvantage members). Both American and Southwest are based in Dallas.
Southwest Airlines is working on faster wifi, bigger overhead bins and USB seat power making them easier to fly (gate checking of bags tends to less of a problem with Southwest than competitors since customers don’t have to pay to check bags, the lack of traditional seat power for longer flights to Hawaii still vexes though).