Southwest Airlines flight attendants may soon be able to sell credit cards on flights to stem pandemic losses

Southwest Airlines is asking flight attendants to sell credit cards on flights in exchange for a smaller pay cut as the company tries to work through expected losses from the COVID-19 pandemic.

Dallas-based Southwest, which told union workers earlier this month they will have to take a 10% pay cut next year to avoid time off work, could start selling in-flight products, including credit cards, as a way to boost revenues and alleviate the bleak. number of passengers booking fares.

JOIN NOW

The credit card pitches emerged this week during a negotiating session between Southwest and Transport Workers Union Local 556, which represent the carrier’s 15,000 flight attendants, according to a summary of the meeting sent to union members.

Southwest, which released its third-quarter results Thursday, declined to comment.

The airline is in a difficult financial position as it enters 2021 and is looking for ways to increase revenues and reduce costs. That’s why the company recently announced expansion plans to airports such as Chicago O’Hare, Houston Intercontinental, Miami and Palm Springs, California, in an effort to broaden its revenue base while a large number of passengers still don’t want to fly.

Southwest’s losses are expected to be high again when it releases its third quarter results. Atlanta-based Delta Air Lines reported a loss of $5.4 billion for the quarter and Chicago’s United Airlines lost $1.8 billion. American Airlines from Fort Worth also reports results on Thursday.

Southwest CEO Gary Kelly and other airline executives have said they don’t expect a significant uptick in air traffic until a COVID-19 vaccine is developed and distributed, which probably won’t happen until late 2021.

Southwest has never had pay cuts or layoffs in its 50-year history. Kelly said the company is looking at many options to avoid this, including new ways to make money and cut costs.

A Southwest Airlines agent works at a check-in counter at Love Field in Dallas.

Southwest is the only major airline to try not to sell credit cards on flights, one of the few ways it sets itself apart from other airlines, along with its baggage-free and no-first-class policy.

Credit card and loyalty programs are an important revenue stream at other airlines. Airlines don’t disclose exactly how much they earn from credit card sales on board, but Southwest said it made $1.3 billion last year from its various credit card programs and agreements with banks.

Selling credit cards on flights often brings in revenue for each new card, as well as potentially cash when customers use those credit cards.

In the past, Southwest has used other means of selling credit cards than harassing passengers, such as emails and partnerships with country music stars.

The airline would need the flight attendant’s union to sign the credit card seats on board because they are the ones selling the tickets. The topic came up in negotiations for a new contract last year, but those talks have been delayed by the uncertainty of the pandemic.

Until now, unions have been icy against the idea of ​​wage concessions. Lyn Montgomery, president of TWU Local 556, said pay cuts have historically not resulted in less leave from other airlines.

“Now, while flight attendants are serving on the front lines of the pandemic, they are doing so with limited opportunities to earn what they previously had, while the company is asking for wage concessions that would result in a further cut in their pay,” the union negotiating committee said. in its letter to members.

Doctors look at a CT image of a lung at a hospital in Xiaogan, China.

Leave a Comment