Southwest’s New “Wanna Get Away Plus” Fare Caps a Long Shift in the Airline’s Fare Structure

Southwest

Southwest has been teasing us for a little while now with promises of a new fare family to fit between its lowest Wanna Get Away fare and its full Anytime fare. That day has now arrived. Say hello to Wanna Get Away Plus.

You can find the details of this fare plastered all over the internet shortly since the embargo was just lifted and media was briefed yesterday, but it’s not actually for sale yet. For that, we’ll have to wait until sometime between now and the end of June. Since this isn’t live yet, pricing details aren’t available. (The feds get pretty irritated when airlines telegraph future pricing moves.) Despite that, there’s plenty to talk about. And to really understand what’s going on, we need to back up and see just how we got here.

A Brief History of Southwest’s Fares

On Southwest, there were historically two fare choices. Travelers could pick the lowest fare or the fully refundable Anytime fare. The only real difference from a customer perspective was that one was refundable and the other wasn’t. About 15 years ago, Southwest rebranded the fares into families. Everything but the full fare was bucketed into the Wanna Get Away (WGA) family. Anytime remained full fare, but then Southwest added another tier above that with a, uh, more fuller fare? That was called Business Select.

The benefits of Business Select were almost entirely based on boarding priority. Sure, travelers earned extra Rapid Rewards points and got a free drink, but the real selling point was that they would get a boarding pass between A1 and A15 guaranteed. And on an airline like Southwest where it’s open seating, the boarding position matters above all.

When this first came out, Business Select pricing was set at a small upsell over the Anytime fare, but Anytime was often a giant leap above Wanna Get Away. It made it very hard to convince someone buying a WGA fare to buy up.

The Mechanics of Southwest’s Current Structure

Over time, Southwest has quietly and completely changed its strategy to more of a pure upsell. To demonstrate this, I pulled the current fare structure in the Los Angeles – Phoenix market, and as a former pricer, I must say that it is a thing of beauty.

Southwest LAX – PHX Base Fares

via Sabre GDS as of March 23

Along the bottom, you can see the RBDs, or buckets, in which each WGA fare books. Southwest has gone with a single fare in each fare family in each bucket with the exception of full Y and also F, which has two fares that vary by advance purchase requirement.

Southwest then uses dual RBDs to determine which fare level should be offered above Wanna Get Away. This means that Southwest looks at two buckets, and the fare will only be offered if both are available. On the one hand, there’s the selling bucket on the bottom of the chart, but then Southwest uses buckets B and L to determine which Anytime and Business Select fare to offer.

If B class is open, the Anytime fare will be $30 above the selling WGA fare and Business Select will be $40 above that. If B class is closed but L class is open, the Anytime and Business Select fares will be an extra $40 higher than if B were open. And if B and L are both closed, then it defaults to the highest Y fare in Anytime and K fare in Business Select. That’s the one situation left where you might still find a giant leap between the fare classes, because it relies on only Y and K being open, nothing else. But more normally, it presents like this:

At this point, the upsells are fairly consistent across markets, though I’ve seen the spread between WGA and the low Anytime fare get up as high as $50 one way.

Enter, WGA+

Now, Southwest is going to add a new tier called Wanna Get Away Plus (WGA+) to slot in between Wanna Get Away and Anytime. There will also be changes to the Anytime fare product which will make it easier for the airline to push fares up in that family to make room for WGA+.

First, as Southwest has said repeatedly, there is no impact on the WGA offering. Some had suggested that maybe we’d see a free bag or something else taken away from the WGA product to create room for WGA+, but those people weren’t paying attention. Southwest was very clear that this would not happen… and it did not.

WGA+ has three key differences compared to WGA:

  • Same day confirmed (if a seat is available) and same day standby (if not) is allowed at no cost
  • Unused credit can be transferred to another person
  • Earn 8x Rapid Rewards points per dollar instead of 6x points on WGA fares

Anytime will gain three new features:

  • EarlyBird is now included
  • Can use priority lanes in airports which previously were for Business Select and elites only
  • Unused credit can be transferred to another person

This will now create four clear products that Southwest can sell instead of the three it has today.

At first blush, WGA+ seems like it will be most attractive to the corporate market. The same day change is a huge deal for a business traveler, especially one on a budget. And the credit transferability is something that the business itself cares about since employees come and go.

It’s been over a decade since Southwest allowed travelers to use credits for someone besides the original traveler, and apparently Southwest’s extensive research shows that people desperately wanted that back. Now, those with WGA+ fares can use the credit for another traveler with a couple caveats. It can only be transferred once, and it must go to a Rapid Rewards member.

What’s particularly interesting about this is that if someone has a WGA ticket, they can upgrade to WGA+ and then the full credit instantly becomes transferable. There are all kinds of ways to try and game this for the enterprising traveler.

One last point on transferability… This is also now a benefit on Anytime and Business Select, but really, who cares? Those are fully refundable anyway.

With this fourth category, Anytime had no choice but to move further up the ladder. The auto-inclusion of EarlyBird — which gives priority boarding over those who don’t have it — and the priority line access creates a clear path and easily-explainable rationale for raising those fares.

There is a concern about collateral damage — that this will result in too many people getting EarlyBird — but Southwest shrugged that off saying this would have a limited impact. It has better data than we do on that, so we can only take the airline’s word for it until the first time someone buys EarlyBird and ends up with boarding pass C45.

At a high level, these changes are not huge, and no benefits were taken away. This is just the culmination of a lengthy process to remake Southwest’s fare structure to create more revenue upsell opportunity. The fares aren’t available yet, so we can’t know what that upsell will be. But when that happens, we can start to see just how much Southwest stands to grow revenues from this change.

7 comments on “Southwest’s New “Wanna Get Away Plus” Fare Caps a Long Shift in the Airline’s Fare Structure

  1. A thought too on the value of same-day changes on Southwest, particularly given their point-to-point network that’s lately had some operational… challenges.

    Recently flew Southwest (Anytime fare) on a snowy day while flights were getting canceled left and right. Ours was the only non-stop on the route that day, so most rebooking options required connections in cities also impacted by snow. I was able to get ahead of the problem and preemptively rebook myself on the next-best available option (through a non-snowy city, when most others ended up in one).

    I realize that’s a very specific anecdote, but I do think there’s more value in paying for more flexibility on Southwest’s network than the big 3 (where rebooking is really just a question of what time you go through Atlanta as opposed to IF you get to your destination or not).

  2. No benefits were taken away – except the existence of a cheaper refundable fare (alternatively, the existence of a refundable fare unbundled from early bird). That’s an important feature to some.

  3. I think the bigger issue is how this dilutes the value of being an elite flier on Southwest (if that even exists). As an A List Preferred member that travels with family, I value being able to get through a quick check in line. It sounds like the priority line will be jammed with people that paid for the privilege. What’s the point of loyalty? Crummy wifi access?

  4. “as a former pricer, I must say that it is a thing of beauty.”

    It’s not a bad fare structure but it’s very common (in my experience) to see Y/K priced since B and L are both closed and I assume this is because they are running out of A1-15 slots. If true, they should decouple the Anytime fare since it doesn’t need a A1-15 slot. They should also increase the allotment of A1-15 to A1-~30 for Business Select to capture more of that demand. Is the issue that they don’t want a D boarding group? How do they handle a 175 seats plane when no one buys Business Select?

  5. I don’t mind these fare changes at all, as someone who has bought non-WGA exactly once (Business Select last minute), and who uses his Priority card to buy up to A1-15.

  6. Will the handicaped & “pre boarders” continue to receive priority boarding? The last time I flew I was effectively about A-35 after they all boarded & i had purchased Business Select.
    How are they accommodating the “parents w young children” category who usually board between A & B? I’m anticipating instances of inconvenienced families & individual customers as I swallow my pride & look over yonder at Spirit despite their built-in hurdles.

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