The announcements came as the firm reported that profits plunged in the April-June period to $367m, down 46% compared with last year. <\/p>\n
Chief executive Bob Jordan said the seating changes would “unlock new sources of revenue”.<\/p>\n<\/div>\n
\n
The company currently assigns passengers to boarding groups based on when they check in. Travellers can also pay extra to board earlier.<\/p>\n
It said its research had found that 80% of customers preferred assigned seats.<\/p>\n
The airline said it would provide more detail about the changes in September. <\/p>\n
The new red-eye flights will launch next year on five routes, including between Las Vegas and Baltimore and Los Angeles and Nashville.<\/p>\n
Premium seats are expected to account for about one third of space, it said. <\/p>\n
Southwest started in the 1970s gaining popularity with lower fares and good customer service.<\/p>\n
It had been known as a holdout in the industry for not hitting customers with extra fees for items such as checked baggage.<\/p>\n
But its share price has dropped sharply over the last few years, as its revenue growth lags others in the industry.<\/p>\n
Last month, Elliott Advisors, which is known for its aggressive and public showdowns with firms it sees as underperforming, said it had taken an 11% stake in the firm and would push for major changes, including the removal of Mr Jordan.<\/p>\n
“Southwest’s rigid commitment to a decades-old approach has inhibited its ability to compete in the modern airline industry,” Elliott said, adding that the airline “outdated software, a dated monetisation strategy and antiquated operational processes”.<\/p>\n
Mr Jordan said he knew that the firm’s performance this spring had fallen short.<\/p>\n
The company has been affected by issues such as delayed plane deliveries from Boeing. <\/p>\n
The airline, like others in the industry, is also facing pressure on fares, after overestimating demand for domestic travel.<\/p>\n
The firm said it was cutting back capacity in the months ahead and the seating changes, in the works for months, would also drive improvements. <\/p>\n
“Although our unique open seating model has been a part of Southwest Airlines since our inception… this is the right choice – at the right time – for our customers, our people, and our shareholders,” Mr Jordan said. <\/p>\n<\/div>\n
\n
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