Southwest Airlines & Philippine Airlines Launch Partnership: Big Deal?

Southwest Airlines is currently undergoing a major transformation, which includes charging for checked bags, introducing assigned and extra legroom seating, etc. It goes beyond that, though, as Southwest is also increasingly launching airline partnerships.

Earlier this year, we saw Southwest launch its first partnership with Icelandair, and the expectation is that Southwest will fly to Iceland. Then we saw the airline announce China Airlines as its second partner, and EVA Air as its third partner. Now we’re seeing the airline reveal its fourth partnership, so these are coming along pretty quickly…

New Southwest & Philippine Airlines interline agreement

Southwest Airlines and Philippine Airlines have introduced an interline agreement, which kicks in effective immediately. With this, travelers can start booking tickets that include travel on both Southwest and Philippine Airlines. This is initially available at four transpacific gateways — Honolulu (HNL), Los Angeles (LAX), San Francisco (SFO), and Seattle (SEA).

Here’s how Southwest Chief Operating Officer Andrew Watterson describes this:

“Each airline partnership brings unique and incremental reach to places around the globe for both carriers and gives more consumers an opportunity to begin or end their journey with Southwest. With nearly 90 flights a day in our schedule that touch the Hawaiian Islands and as California’s largest air carrier, Southwest is positioned like no other airline in serving Philippine Airlines’ passengers arriving or departing the United States.”

For now this partnership only includes an interline agreement. This is the most basic level of cooperation two airlines can have. There’s no codeshare agreement, or loyalty collaboration, or anything. The interline agreement simply makes it possible to book a ticket that includes travel on both airlines. This possibility is already available online, on Philippine Airlines’ website, plus through online travel agencies.

There’s not really a whole lot to this partnership

Southwest is still new to the world of airline partnerships, so it’s interesting to see the approach the carrier is taking. For example, Icelandair was announced as the first partner, and it seems pretty clear the airlines are actually planning a higher level of cooperation, eventually having a codeshare agreement, frequent flyer reciprocity, etc.

However, it’s interesting to see Southwest now seemingly randomly partnering with Asian carriers. For example, Southwest is partnering with both China Airlines and EVA Air, which are competitors in Taiwan, suggesting there won’t actually be a close level of cooperation between those airlines.

Interestingly, Philippine Airlines also partners with Alaska Airlines, and that comes with more reciprocity in terms of earning and redeeming miles. There’s a lot more consumer benefit there, if you ask me.

I can see big upside to Southwest establishing close partnerships with foreign carriers that enhance the value proposition of the loyalty program. However, just picking up low pro-rated interline revenue doesn’t exactly seem like a strategy that will materially impact financial performance.

Then again, with Southwest no longer being a “premium” airline that includes all kinds of services, I guess the company is more happy with that than in the past, and there’s not much downside to this.

Side note — it’s funny how Southwest’s image used for this partnership shows the tail of a Philippine Airlines Boeing 737, even though the airline doesn’t operate that aircraft type.

Bottom line

Southwest Airlines and Philippine Airlines have just launched a partnership. In reality, this is the most basic form of cooperation you can have, as this is simply an interline agreement that allows you to book travel including flights on both airlines (while also being able to check bags).

It’s interesting how Southwest’s first partner was Icelandair, where there are actually plans to have closer cooperation over time. Meanwhile the three most recent partnerships all seem to be pretty casual, without any stated plans to expand them beyond the initial phase.

What do you make of Southwest & Philippine Airlines partnering?