How Southwest Airlines seats could work: Wall Street analyst

While other airlines accumulate frills for sale, Southwest Airlines has remained true to its roots.

But with the demand for tickets compared to last year, JPMorgan is thinking about getting the discount carrier to get its share of the billions of dollars that travelers pay every year for things like checked baggage, modified reservations and premium seats.

In a recent memo to clients, badyst Jamie Baker began to "advise on the feasibility and potential profitability of Southwest's seat monetization." However, the bank would like to "forcefully insist" on the fact that it was not aware.

President and CEO Gary Kelly said new sources of revenue were "under construction" when calling the fourth quarter results of the Southwest in January, according to Bloomberg, which had for the first time released a report on the JPMorgan note.

The bags will likely be on the table – "that's not what we do," said Kelly – but monetizing the seats could fill many gaps, JPMorgan says.

"Southwest could easily add an annual EPS of $ 0.10 to $ 1.00 by monetizing up to four rows of each plane," Baer writes. "Essentially, offering a cash withdrawal to the need to queue up in advance, thus guaranteeing the latest status of first lit / first ally for travelers (with a dedicated space for lockers)."

This would tick four boxes for the airline, which currently has a Business Select option for earlier boarding, but which maintains a coach-only cabin for decades: "ease of operation, ease understanding of pbadengers, benefits and wider preservation of existing infrastructure ". Southwestern experience, "says Baker.

Sitting & # 39; somehow & # 39;

Instead of shipping first, JPMorgan has an idea that fundamentally reverses the common concept of priority placement.

Up to four rows of the aircraft would be reserved for premium tickets, potentially business travelers, guaranteeing access to benefits such as the first outing and the upper memory.

Read more: The Southwest Airlines Pbadenger Pbad is the holy grail of travel rewards – I've used mine for 3 for 1 flights with my wife and my baby

"In simple terms, this would eliminate the need for queuing prior to boarding time – a process that, in our opinion, is wasting time for travelers in exchange for a downsizing in the southwest, "Baker writes.

According to Baker, this would probably not cost Southwest much and would allow flight crews to save time if the new clbad included exit lines, because pbadengers to whom the law prohibits access to these seats are not allowed to travel. would probably not buy bonus tickets.

But will this theory be put into practice one day?

"We have no idea," Baker says. "Although we can not give any idea of ​​what the company might think about, we think we understand what the new booking system is capable of doing, as well as what pbadengers could potentially react to with enthusiasm – especially travelers d & # 39; business. "