Southwest Airlines Makes Significant Change to Business Model

Southwest Airlines has quietly changed one of its most strict policies, but only for relatively high-paying customers. Southwest has long refused to cooperate with third-party websites like Kayak, Expedia or Orbitz among others, claiming that it can keep prices down easier by only selling tickets directly. According to a report by ZDNet that has now changed, but only for business class travelers.

The commercial airline industry is still struggling to recover from the COVID-19 pandemic, and a well-documented shortcoming in that recovery has been the slow return of business travel. Southwest has reportedly compromised its opposition to third-party websites in order to lure business trip planners to buy tickers. ZDNet contributor Chris Matyszczyk visited Kayak.com to compare prices and was met by a pop-up ad boasting: "This is big. Southwest is here."

Kayak for Business travelers can now book Southwest Airlines. Sign up. It's free," the pop-up continued. This is notable considering Southwest Airlines' hardline opposition to sites like Kayak in the past. Last year, a company representative explained in a statement reading: "By utilizing Southwest.com and our call centers, customers can rest at ease knowing that when they go to book with Southwest, they're getting the lowest fare without any strings that online travel agencies might try to sneak in there, such as fees and restrictions. This is especially important as a low-cost, low-fare, high-quality airline."

"Allowing a third-party access to our consumer fares and flights adds a new dimension that would erode our promise to our customers of offering friendly, reliable, and low-cost air travel," they continued. "We prefer to build a relationship with the customer on their journey from booking to destination, and OTAs [online travel agencies] would change the experience our customers expect from us."

Matyszczyk speculated that this change is a result of Southwest's lackluster earnings so far in 2022. According to a report by Skift, the company's CEO hosted an earnings call last month where he admitted that Southwest is already behind schedule for 2022. He chalked this up to slow business travel, since so many people are now working from home and employers do not want to put their workers at undue risk.

Putting flights for sale on sites like Kayak is a way of enticing businesses, not necessarily individuals. However, no single step will overcome the uncertainty of the COVID-19 pandemic. So far, Southwest has not commented directly on this policy change.