Southwest Airlines will have assigned seating in 2026
Southwest Airlines (LUV) is shaking things up to turn its fortunes around, announcing that its new assigned-seating flights will begin in the first half of 2026.
“We have been hard at work putting together a purposeful plan to begin selling and then operating our new assigned seat model that balances speed to market and realization of the financial value while managing our ability to execute the rollout well,” CEO Bob Jordan said at the company’s investor day presentations Thursday.
Because the company is trying to end its legacy open-seating policy at the same time that it’s putting a stronger emphasis on premium products, it has a lot of work to do to make that happen. It’s planning to redesign its plane layouts and retrofit its aircraft to that effect, re-train its sales and flight attendant staff, and redesign its customer-facing systems to make sure everything runs smoothly.
“Taking all of this into consideration, we plan to begin selling assigned seats for travel in the second half of next year and plan to begin flying them in the first half of 2026,” Jordan said.
In the background of Southwest’s changes is an activist campaign from Elliott Investment Management, which has an 11% stake and wants Jordan out of a job. The hedge fund was not impressed with the timeline laid out.
“Today’s announcement that adding assigned seating and premium products will take multiple years to implement — when peers have implemented similar changes in much shorter time frames — is further evidence that Mr. Jordan lacks the vision and capability to execute on these initiatives,” Elliott said in a statement responding to the presentation. “This is yet another long-dated promise through which Mr. Jordan is playing for time, not success, but he is playing with shareholders’ money.”
After Southwest said that it would be giving shareholders $2.5 billion of their money back to them Thursday, the company’s stock surged.