December 18, 2012 - 01:10 PM ET
Southwest Airlines next year will add no-show fees and raise other fees, according to executives. "Specifically, we will implement a no-show fee for reuse of funds associated with restricted tickets that are not flown and not canceled by our passengers prior to flight," chief commercial officer Bob Jordan last week told investors and analysts. "This should add ancillary revenue and promote customer behavior that allows us to resell the open seat prior to departure, so you have a double win there." The timing and additional details were not divulged. The company in the first quarter also will raise fees for third checked bags and overweight bags on Southwest flights, sell "open and premium boarding positions" at the gate and increase some fees associated with AirTran flights, including $25 for the first checked bag (up from $20) and $35 for the second (up from $25). Combined, no-show fees, the sale of open boarding positions and increases for other assorted fees will generate as much as $175 million annually, according to Southwest. "The industry and consumer behavior has changed substantially over the past 10 years and we know that," Jordan added. "We've realized that we cannot sit still as things change."
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