Southwest has seemingly just completely changed the value proposition of its Rapid Rewards program, with absolutely no advance notice, as flagged by View form the Wing. Honestly, this might be the single most ruthless frequent flyer program change we’ve seen from a major airline.
In this post:
Southwest reduces points earning by up to 67%
With absolutely no advance notice, Southwest Rapid Rewards has completely changed its points earning structure:
- Wanna Get Away fares have gone from earning 6x points to earning 2x points
- Wanna Get Away Plus fares have gone from earning 8x points to earning 6x points
- Anytime fares continue to earn 10x points
- Business Select fares have gone from earning 12x points to earning 14x points
As you can see, clearly Southwest wants to incentivize Rapid Rewards members to book more expensive fares. On the low end, we’re seeing points earning reduced by 67%, and on the high end, we’re seeing points earning increased by 17%.
The changes are even bigger if you have elite status, since A-List members receive a 25% bonus, and A-List Preferred members earn a 100% bonus.
So an A-List Preferred member booking a Wanna Get Away fare would go from earning 12x points per dollar spent to earning 4x points per dollar spent.
For what it’s worth, I value Rapid Rewards points at around 1.2 cents each. So by my valuation of points, Wanna Get Away fares are basically offering the equivalent of a 2.4% return on airfare spending after these changes. Ouch.
What an unbelievably brutal loyalty program change
We know that Southwest is under major pressure to improve profitability, given the activist investor the company has, in the form of Elliott Investment Management. So we know the airline is looking for any possible way to improve its margins.
However, I don’t think I’ve ever seen this significant of a frequent flyer program change, whereby the most common fare sees a 67% reduction in points earning. There’s absolutely zero advance notice being provided here, and these changes aren’t just minor, but completely alter the value proposition of the program for many members.
This almost seems like an informal way to create basic economy, which is something the airline has for years said it wasn’t going to do. While I would respect the change if that’s the direction the airline were headed, the complete lack of notice here is what’s most disappointing.
It’s clear the “old” Southwest has died, and it’s not coming back. For example, the company recently announced its first layoffs in history, when lack of layoffs was historically a point of pride at the airline. It’s sad to see how everything the airline has been working on for decades is just being flushed down the toilet…
Bottom line
Southwest has just made massive changes to its Rapid Rewards program, without advance notice. The airline has hugely cut points earning on cheaper fares, and has mildly increased points earning on the most expensive fare. I can’t remember a major frequent flyer program that ever made such a significant change without notice.
What do you make of these Rapid Rewards changes?
Not good. Been a rapid rewards customer since ce 2017. May have to look elsewhere.
WN employee here. The fact of the matter is we’ve been taken advantage of by low margin customers for too long, and we were the only major airline who increased headcount at HQ after COVID - way too much overhead that wasn’t generating revenue and needed to be culled. The way they were doing things wasn’t working. To quote the timeless film Joe Dirt: “this is a business not a charity, you know maybe one day unicef will get into the airline business”
I'm going toʻ use up the rest of my points and then I'm done with SW! It was a great airline but when a new investor buys 10% of the stock and forces the company to make drastic changes to make more profits at the cost of its employee's jobs then that tells me it's all about the money and greed! I feel so sad for all of the employees at Southwest. We, the consumers...
I'm going toʻ use up the rest of my points and then I'm done with SW! It was a great airline but when a new investor buys 10% of the stock and forces the company to make drastic changes to make more profits at the cost of its employee's jobs then that tells me it's all about the money and greed! I feel so sad for all of the employees at Southwest. We, the consumers (the general public), loved the way Southwest was run but some ahole had to come in and ruin it for everybody because he wants to make a ton of money! My heart goes out to all of the employees and the ones that got laid off due to this new investor. Maybe someone needs to start a private airline that is not publicly traded so things like this won't happen. I know that's not possible but i have the right to dream about it.
It’s a shame management has been forced into shareholder value is now number one. Employees and customers no longer matter only the few executives the hedge fund appoint will make the big bucks, everyone else suffers. What a shame. This is now the way to make money in the Good old USA!
These changes are not as bad as Delta's strategy of sharply raising award prices. Southwest's way hurts future earnings but not points already saved.
I try to exclusively fly Southwest domestically . Twice a month for 13 years. I even have a chase Southwest credit card. With this rewards change and the seating changes coming. Might as well fly on other airlines. Why? Because now Southwest is just like the other airlines. No difference. What’s next charging for checked bags.
SWA airlines has now changed its business model to the point it has now matched every bankrupt and fail airlines of the past. Or, as some call this: "Pissing in the soup." Congratulations.
Fire Bob Jordan!
He's done nothing for this company other than
In 2022 collected $5,300,000
In 2023 collected $9,300,000
In 2024 collected another $9,300,000
Correction, he has driven DOWN the stock price by over 30% since becoming CEO
Southwest is going the route of other legacies. For a dirt cheap fare you will get less, including lower award points.
Spirit and Frontier will own the low cost segment. And the Spirit Go Big first class rules.
This is a HUGE disappointment from Southwest! I have been a rabidly loyal SWA A-List Preferred member for years. I know they under intense pressure to bring more profitability but this is ridiculous. You can't continue to alienate your loyal customers like me by acting like all of the other airlines. NO MORE CUTS TO THE SWA MODEL THAT WE SUPPORT WITH OUR LOYALTY and $$$$$$$$
DAL, UA, and Alaska have record profit margins and offer basic economy fares. They have successfully segmented price points people will pay and offer different service/comfort for their premium, main, and basic economy products. SWA wants to those margins since its current business model is outdated.
Only outdated because they didn’t subscribe to new rule: shareholders value is all that matters, employees and customers do not matter. The great American hedge fund way
You’re going to get more points… this helps you. Did you not read?
So this was Spirit’s plan to avoid Chapter 11 all along: pick up 30% of WN’s pissed-off passengers!
Agreed - tough changes, poor communications!
The industry around them has changed and Southwest hasn’t adapted! They started as a low-cost airline, yet have a loyalty program, offer free luggage,..?
They have no differentiation - not the best product, not the best customer service, not the lowest prices!
The changes they are making seem to suggest that they don’t want to compete on price - good luck with that…
I think...
Agreed - tough changes, poor communications!
The industry around them has changed and Southwest hasn’t adapted! They started as a low-cost airline, yet have a loyalty program, offer free luggage,..?
They have no differentiation - not the best product, not the best customer service, not the lowest prices!
The changes they are making seem to suggest that they don’t want to compete on price - good luck with that…
I think they’d be better off going full RyanAir - no carry on, no free checked bags, seat fees, end loyalty program, faster turnarounds, no changes to planes required…
The US market is incredibly focused on price, yet there is no true low cost airline like Ryan Air, WizzAir or AirAsia in the US… and, no, Spirit maybe low quality, but they can’t compete operationally with Ryan Air et al…
Because of this change I will not be flying Southwest any longer
Why, every other airline offers a similar basic economy product which WGA is becoming?
Alaska is next.
They already have reduced earning rates for "Saver" fares...been that way for awhile
Yet again, more evidence to NEVER STOCKPILE MILES. This is a currency that can be instantly and unilaterally devalued by the only storefront that accepts them. Don’t convert your dollars to miles unless you know exactly what and when you’re going to spend them on, and use the ones you have as quickly as possible.
And NEVER buy miles speculatively, no matter how often Lucky posts about promotions. Only buy miles to top yourself...
Yet again, more evidence to NEVER STOCKPILE MILES. This is a currency that can be instantly and unilaterally devalued by the only storefront that accepts them. Don’t convert your dollars to miles unless you know exactly what and when you’re going to spend them on, and use the ones you have as quickly as possible.
And NEVER buy miles speculatively, no matter how often Lucky posts about promotions. Only buy miles to top yourself up to achieve an award redemption that you can clearly see.
This devaluation does not affect accrued miles. The Southwest Rewards points one had yesterday are worth the same today. I agree with you stockpiling miles is generally a bad idea but what Southwest did is not applicable to this thesis.
Why does Ben post about Southwest?
He never flies them.
Maybe he should do a post about a Southwest flight!
Because they’re a huge airline that many of us fly on from time to time?
How much variation does Southwest really have worth doing new reviews? A flight from LAS to MDW to FLL to MBJ. All the same thing.
It doesn’t bother me at all. Maybe this will stop the runway Jesus pre boarders
Unlikely. I don't think they play the points game.
When I used to fly SFO - DCA on United, I'd earn about 2,400 United miles. On a flight I just booked, I'll earn under 600 miles (a 75% cut).
So, as bad as this SWA change is, is this REALLY the worst frequent flyer change we've seen?
You found a UA fare SFO-DCA for $120? That’s pretty good.
Assuming you don’t have any status with them. Otherwise your fare would be down around $60.
If they start charging for bags, or start charging change fees, I’ll never fly them again. That was their saving grace.
I am amazed how many folks drag 1 or 2 bags on SW, especially given that it is free!
As we board, the FA’s are telling us to put our computer bags in the foot space to accommodate folks that choose to not check free luggage. I’m a big guy, don’t ask me to give up what little space I have to put my feet!
"It’s sad to see how everything the airline has been working on for decades is just being flushed down the toilet…" I think that extends to many other venues and endeavors in the US. Not the least how we treat our trusted neighboring countries, and alliance partners.
So, why expect Southwest to be different!?
The country is being pulled out of the toilet it was flushed in the past four years.
Spoken like the MAGA GARBAGE domestic ENEMY of State that
you are
Maybe ur life has lived in the toilet but not mine. My stock portfolio was killer…..sorry u only invested in meme coins….But these last few weeks…….very sucky. I pray for a tragedy
This is very sad. Always had a tremendous amount of loyalty to Southwest Airlines. It’s unfortunate that they don’t have the same loyalty anymore to their customers. We’ve been a list and had a companion pass for years, this may be the end of that.
Corporations are loyal to shareholders, not customers.
I've been saying the shine has worn off Southwest since COVID. I can't really put to any specific thing, but it just doesn't feel the same anymore. And I've been picking different airlines based more on convience than cost. I'm no longer loyal though I have a ton of points and credits I could redeem. The bene's on the credit card are decent enough to get the A upgrade a few times a year. And...
I've been saying the shine has worn off Southwest since COVID. I can't really put to any specific thing, but it just doesn't feel the same anymore. And I've been picking different airlines based more on convience than cost. I'm no longer loyal though I have a ton of points and credits I could redeem. The bene's on the credit card are decent enough to get the A upgrade a few times a year. And I've stopped buying early bird because I still wind up in C. On a recent flight I bought the flight the minute the schedule opened, nearly nine months in advance, and still got C with early bird. Ripoff.
Buying early bird and ending up in the last third of the plane to check in? I strongly doubt that?
Doubt it all you want, but it happened. The schedule changed and I suspect it had something to do with that, but when I called to even seen if they'd offer a refund for early bird as a gesture of good will they basically told me to pound sand and non-refundable means non-refundable.
I’ve been B48 with early bird. I learned it was related to buying the cheapest fare.
My plan is to no longer buy EB on cheap fares. I just manually check in at T-24 to the second and buy the A1-A15 upgrade when it’s available. Usually a similar cost.
That's what I used to do as well, buy cheap then upgrade at check-in. My current trip the one way A1-15 upgrade was another $153. Sure, good use of a card upgrade credit but $153 is a huge price increase on this ticket. Even just a year ago this one way upgrade cost about $50. WN is certainly squeezing every dollar they can
Though I am obviously disappointed at the change, this is still much better than a devaluation, which is more often where airlines turn. For customers with large point balances, this will in no way affect the value of those accumulated points.
At the end of the day, leisure travelers are not looking at how many points they'll earn when picking a flight, they're looking at the price. I don't see this changing much or turning any customers away.
whether Elliott had to tell them or otherwise, WN realizes it is not profitable to offer ultra low cost carrier fares the same level of benefits as higher fares.
2 free bags for wanna get away fares will likely fall next.
when they start assigning seats, they will get seats at the end of the process like at other carriers.
and WN reportedly is closing AUS and FLL FA bases on the cost...
whether Elliott had to tell them or otherwise, WN realizes it is not profitable to offer ultra low cost carrier fares the same level of benefits as higher fares.
2 free bags for wanna get away fares will likely fall next.
when they start assigning seats, they will get seats at the end of the process like at other carriers.
and WN reportedly is closing AUS and FLL FA bases on the cost side.
This will be a slow, brutal process but they will be around in 5 years which is not a certainty for some other smaller airlines
In five years they are going to be called Delta.
Just take the free bags away - I think consumers would be fine with $10/bag to start. This is brutal and cuts biz frequent fliers the hardest. But hey, they have an international partner now...
If I try to redeem points on nearly any flight I actually need to take, they all seem to be worth about 1¢. So this is not much different. Sure, you can scour specialty sites and score nicely on year-from-now flights in luxury classes, but you would never have paid those cash fares anyway. $150 fee airline credit cards are now giving you less value than free credit cards, unless you check bags.
Does this affect already booked tickets?
Yes. Earnings for all flights starting today are the new rates. Doesn’t matter when you booked them.
My flight in March still tells me i'm earning 800 points for my ~$150 ticket, FWIW
Meh, most people don't like Southwest anyway and complain tons about their reliability and lack of seat selection. Now the airline is making decisions to stay in existence, just like any struggling business owner would do.
You had to think big changes were coming when an airline that historically hasn't offered biz class or seat selection, is now offering those things in the near future. Notice would have softened the blow maybe but the inevitable...
Meh, most people don't like Southwest anyway and complain tons about their reliability and lack of seat selection. Now the airline is making decisions to stay in existence, just like any struggling business owner would do.
You had to think big changes were coming when an airline that historically hasn't offered biz class or seat selection, is now offering those things in the near future. Notice would have softened the blow maybe but the inevitable is still the inevitable.
Its more about montetization than trying to stay competitive. SWA's business model has been simple -- you pay your money, you get transported from A to B. With the hedge fund takeover its joining the other airlines in slicing and dicing the product in order to increase 'yield'. Obviously there will be a lot of PR spin about this that will talk about 'consumer choice' etc. but ultimately it just means we'll be paying more...
Its more about montetization than trying to stay competitive. SWA's business model has been simple -- you pay your money, you get transported from A to B. With the hedge fund takeover its joining the other airlines in slicing and dicing the product in order to increase 'yield'. Obviously there will be a lot of PR spin about this that will talk about 'consumer choice' etc. but ultimately it just means we'll be paying more for the same product, if nothing else to cover the administrative overhead of this slicin' and dicin' and to pay the fees and bonuses associated with this type of takeover.
“most people don't like Southwest anyway”
Source? Obviously airlines in general aren’t popular but historically WN has been relatively near the top.
Points Guy had them ranked 5th in the US last year lol. If that's where you're ranked behind the likes of AA and United, I'd say you are not liked very much.
Reliability? #2 in WSJ airline rankings because they’re more reliable than anyone other than Delta, and not by a small margin. Also you have to pay for premium economy to get comparable space on UAL/DAL/AAL.
Southwest has spent 2 weeks losing my business for being denied boarding on recent flight, and not being able to get a specific reason. Now my rewards are gonna take a pounding. Outstanding job Southwest
Southwest does not deny boarding lightly, so it seems like it’s time for you to do some self-introspection.
Vote with your dollars.
I know I will. I only fly WN if it is cheaper. SJC-LGB is about the only route this is true (for me)
Elliott (a.k.a. the reincarnation of Gordon Gekko) is at it again. Destroying a formerly great airline in the interest of wringing every penny out of it for their insiders. How, WN's board allowed this to happen is appalling. Now, we get to watch these vultures slowly kill WN and pick their carcass clean once it's done. Seriously, this strategy reminds me of how newspapers decided to "save themselves" about 20 years ago: cut, cheapen, give...
Elliott (a.k.a. the reincarnation of Gordon Gekko) is at it again. Destroying a formerly great airline in the interest of wringing every penny out of it for their insiders. How, WN's board allowed this to happen is appalling. Now, we get to watch these vultures slowly kill WN and pick their carcass clean once it's done. Seriously, this strategy reminds me of how newspapers decided to "save themselves" about 20 years ago: cut, cheapen, give less value, raise the price. It's all about the assets folks. And it can be a very slow death this way.
This should really be illegal.
What years was Southwest a great airline?
1971 til around 2005
2 decades ago. Nice! I think McDonald's was good back then too. Probably made their biscuits fresh and their beef wasn't frozen.
I flew them a ton between 2014 and 2018 (my employer at the time required us to book via SWA Biz) and they were a darn good airline then too - even if not quite as special as they were back in the 90's-00's.
It sounds like they're trying to turn WGA fares in to basic economy
That's exactly it- they probably came to realization that they were giving too much away with the base fare, vs loyalty point earnings at other airlines who offer Basic Economy