Loading summary
Transcript142 lines
- [00:07]
A
I'm David Brown and this is Business Wars. You know, for a long time Southwest Airlines was flying high on its reputation. They touted fun loving flight attendants, a generous free check bag policy and open seating that kept ticket prices low. But lately the company's been experiencing some turbulence. The policies that made them not just famous but beloved are going away. In 2025, they announced that they were switching to assigned seating and charging for bags on most fares and customers were none too happy about that.
- [01:02]
B
I literally feel like I was cheated on. I've always had a good experience on Southwest, but this is probably going to make me change my mind with who I'm flying.
- [01:11]
C
They took to Instagram and they posted this. We've made updates to our bag policy and you're still going to love flying with us. And people in the comments are not happy. There is not a single positive comment in these comment section.
- [01:21]
A
All this comes as the company's still regaining trust, or at least trying to, after a system glitch that canceled thousands of flights in December of 2022, leaving nearly 2 million passengers stranded as they headed home for the holidays. So how can Southwest land this plane? Joe Gwinto might be able to help. Now, he's no pilot, but he is a business journalist who's covered Southwest Airlines for decades. You may recognize him as the writer behind business wars, seasons that include Southwest versus American and Starbucks Bitter Brew, among others. Joe is joining us today to walk through Southwest's strategy and the rationale behind their recent changes. He's also sharing what it was like to be on the same flight as Southwest CEO Bob Jordan and witnessed the airline's top dog serving drinks, chatting up customers and even cleaning the plane. Later on, we're geeking out over all things flying with the aviation queen herself, Benet Wilson. Benet is a reporter at Bankrate covering credit cards, travel and personal finance. She has decades of experience covering the aviation industry, hence her title is Queen and is talking with us about the golden age of flying, why today's flight prices feel more expensive than they really are, and the best travel credit cards every frequent flyer needs to know about. So passengers, put away your tray tables, get that seat back in its upright position and prepare for takeoff. Because all that is coming up. This message is brought to you by Apple Card. Did you know Apple Card is designed to help you pay off your balance faster with smart payment suggestions? And because fees don't help you, Apple Card doesn't have any. So if your credit card isn't Apple Card, maybe it should be subject to credit approval. Apple Card issued by Goldman Sachs Bank USA, Salt Lake City Branch Variable APRs range from 18.24% to 28.49% based on creditworthiness rates as of July 1, 2025 Terms and more at Apple Card after telling hundreds of stories about business battles throughout history, I've learned one constant truth. Having the right support systems in place can make or break a new venture. Trust me, it was a battle even I faced on my business journey. That's why AT&T business makes so much sense for entrepreneurs today. When you're building something from scratch or even just at the point where you're ready to grow, you need a provider that makes things easy. With AT&T business, you you can have reliable, protected Internet connection you can count on, so you do not miss a beat. Building your dream might take time and a lot of work, but that doesn't mean it can't be a little easier. Wake up to the power of ATT business and turn your vision into reality. Business.att.com Joe Gwinto welcome to Business Wars.
- [04:24]
C
Thanks for having me.
- [04:25]
A
You know, we were talking a little bit before we got the tape rolling. You were telling me a little bit about your time in Texas and I asked you if you happened to have met Herb Kelleher, who was the founder of Southwest Airlines, and was stunned that you said not only did you meet him, you talked to him several times.
- [04:44]
C
No, I did. I probably interviewed him formally about a half a dozen times. But my first big story actually as a magazine writer was a profile of Herb Kelleher. And you really couldn't go wrong with him because he did all the heavy lifting. He was such a great personality that I hardly had to do anything except transcribe what he said.
- [05:03]
A
Every description that I've ever read or heard about him sort of sounds like a larger than life figure. When you think of Herb Kelleher, what comes to mind?
- [05:13]
C
I think that just the smarts. Even though he was very focusy and easy to talk to and would always remember a name and a face, he was just so smart. I mean, he was really strategically brilliant with building that airline. When he took over, I think in 78, it was still a pretty small regional carrier and he got it across the country and he outflanked a lot of bigger rivals with a lot more money, beating United and American at their own game. Sometimes the part where he was great with people was really critical to Southwest's culture.
- [05:44]
A
It almost seemed like there were two sides of his personality, right? I Mean, on the one hand, he was a very strategic thinker, so much so that, I mean, it's not like he made a lot of enemies in this business, but he sometimes was seen as not necessarily playing by the rules. He would look for his advantage, and he'd take it. And yet he really did have this sincere feeling about how successful businesses can only really thrive if the employees feel like they have a stake in a successful outcome. That was really. You know, you hear a lot of people talk like that, but he really felt that. Was that your sense?
- [06:26]
C
Yeah, absolutely. He must have said probably every time I ever talked to him that employees came first at Southwest. That was their differentiator. He basically would say, you know, any other airline can go out and they get the same 737s that we fly, but they can't get our people. And for Southwest, it was employees first for Herb, and it was customers second. If you take care of your employees, they'll take care of your customers. And if the customers are happy, that will make the shareholders happy. That was the philosophy that he always operated by, and it certainly showed up in the results they had many consecutive. Not just years, but decades in the black.
- [07:03]
A
He encouraged employees to kind of build that culture. I mean, they called it the Love Airline, not just because of the cuddly imagery, but because they operated out of Dallas Love Field, which gave it a kind of competitive advantage. Certainly back when it was first getting started with the other carriers were operating out of busy DFW Dallas, Fort Worth. You know, Southwest always felt like, especially if you were in Texas, like it was homegrown, like there was something really organic about it. Like these folks on the plane, they were sort of your neighbors. And it's funny how he really leaned into that Texas, that Texanness, I think, certainly early in Southwest's days, don't you think?
- [07:45]
C
Yeah, absolutely. There are a lot of people who think Herb was a Texan. He was actually from New Jersey. But once he got himself on the ground there, he got his boots on the ground there in Texas. He really fit right into the culture. And with Southwest, he became sort of the pitch man. For many years. He was in the TV commercials. He was in the print ads. People got to know him personally. At least they felt they did when they were customers, because he was trying to personify, really, the image that Southwest was trying to put out there, which was, you can just come with us and hang out and get on this plane and fly it for fun if you want to, because we're always going to get you there.
- [08:23]
A
I know you interviewed another key figure in our series on Southwest, CEO Bob Jordan. What was he like?
- [08:30]
C
He's not. He's certainly not Herb, but nor would he pretend to be. But overall, you know, Bob is very nice, and he fits very much into the Southwest mold. He's been there for three decades himself. And he was there in Herb's day and got to spend enough time with Herb, I think, where at least a little of Herb's personality rubbed off on him.
- [08:49]
A
I want to know if I heard this story correctly, what I heard. You were just on a Southwest flight and you bumped into Bob Jordan?
- [08:58]
C
Yeah, I got on a flight on June 18, it was, which happens to be the 54th anniversary of Southwest's first flight. And I probably am one of the very few passengers on there who knew that fact before I got on. And I got on, I had just actually completed work on this series about Southwest Airlines for business wars. And Southwest was very much in my mind. And then I look up the front of the plane, I'd gotten on pretty early, and I see a guy who looks exactly like Bob Jordan. And I thought, wow, I'm just. I'm hallucinating. I've been writing about Southwest so much that I don't even know what's what. And then I looked at him a little longer. I realized he was wearing a lanyard that said Southwest Airlines, and it really was him. So I was pleasantly surprised that I wasn't imagining things.
- [09:45]
A
Did you go up and say hello or introduce yourself?
- [09:48]
C
He got on pretty late, so I kind of. I waited till the end of the flight. During the flight, as Herb used to do, he passed out snacks. And afterwards, you know, he came around with the trash bag and he picked up the trash. And when I got off, I kind of waited for him in the jet bridge, and I had to wait there almost a half an hour because as I found out from all the flight attendants who had been taking pictures with him and getting autographs, apparently Bob decided he was going to clean up the whole plane for them.
- [10:14]
A
You are kidding.
- [10:15]
C
Yeah. He cleaned up the plane. They put the seatbelts back where they were supposed to be and the whole thing. So. Yeah.
- [10:21]
A
Let me ask you, do you think that that was sort of the boss being. You know, sometimes a high profile boss might want to do something to sort of show his solidarity with workers and that kind of thing, or do you think this is kind of coming from some other place with him?
- [10:36]
C
It's very much a Southwest tradition. For all the changes that Southwest has gone through in the past, probably five or six years now. It's still hardwired into its past. They still have a lot of respect for the Herb Kelleher days. And that is 100% something Herb would have done is pick up a plane or talk to flight attendants for so long that he might have even delayed a flight. And so I think Bob was very much trying to fit that mold. And so it probably comes natural for him from being there for so long.
- [11:06]
A
When was the first time you flew Southwest? Do you remember?
- [11:09]
C
I do. I was on my way to get engaged. I took a flight to San Antonio on a very old Southwest 737. It might have been a 200 model.
- [11:20]
A
Aren't they all Southwest 737s? You sort of have to go, know the minutiae, the 200 model, that sort of thing.
- [11:27]
C
Right. This model was the kind they used to call them, I think, party seats or business seats. And they had seats that would face each other, so in the front and in the middle.
- [11:36]
A
Yes, exactly. Yeah. It was like sort of like train seating. You'd be, you know, be sitting across from somebody who'd have their boots up in your lap there.
- [11:44]
C
That's right.
- [11:45]
A
Facing you.
- [11:45]
C
Right, yeah. And my fiance and I, we sat facing backwards, and we happened to be sitting across from a couple. It was a somewhat older woman and a younger man. We assumed they were mother and son. And about 15 minutes after takeoff, they started to make out. So I guess they weren't.
- [12:07]
A
That's so funny. So that would have been, what, in the 80s?
- [12:11]
C
Maybe that was in the late 90s.
- [12:13]
A
Yeah, late 90s. Okay. I didn't realize that they were flying those backward seats that late.
- [12:17]
C
Probably one of its last flights.
- [12:19]
A
Yeah, yeah, yeah. But that says something about how traditions sort of die hard in Texas. Its reputation, though, as a kind of bus of the skies, I never thought of it in a sort of negative sense. I always thought of Southwest as being a kind of place where, if you needed to hop a plane because you needed to get to anywhere in Texas. And you gotta think Texas is the size of France. Right. So if you need to get to, I don't know, from Dallas to Houston, this was especially true in the pre TSA days. You would just book a ticket real fast, wouldn't cost you very much, and you could just catch that bus of the skies, and you'd be off to wherever you were, and then there you'd be. It kind of made Texas feel a whole lot smaller. And in a sense, you know, that sort of solidified that bond that a lot of folks had with Southwest is sort of like, this is my personal airline, in a way.
- [13:15]
C
Yeah, that's right. I think that's one of the reasons why Herb is in the Texas Business hall of Fame. Southwest literally made that state feel smaller. And that is exactly how it worked. You go up to the ticket counter, they had cash registers, literal cash registers, and they would print out a ticket. At some point, they had to start stamping, this is a ticket on the back of the car, the receipt. Because people would just throw them away, not realizing that was their boarding pass.
- [13:41]
A
And of course, today, Southwest is experiencing a major cultural shift. A lot of decades old policies are getting upended. Joe, walk us through some of these changes.
- [13:50]
C
Oh, yeah, absolutely. I think the first one that came was they ended the open seating. I think that actually formally kicks off in January of 2026, but they announced it late in 2024, and it was a shock to a lot of people because they thought, well, Southwest has always had open seating. It's always going to have open seating. But the fact was, Southwest was a little bit behind on this. They had surveyed their customers a decade ago, and customers wanted the open seating to stay, but they hadn't really done a massive survey since then. And when they did, they found out that about 80% of the people who fly the airline would prefer to have an assigned seat. And they've also found out more than that. About 86% of the people who chose not to fly on Southwest did it because they wanted an assigned seat and they were willing to go somewhere else to get one.
- [14:41]
A
They're getting a lot of blowback online, too. I think we have a couple of tiktoks that sort of bear that out.
- [14:47]
B
If you remember the want to get away fares, those are no more. They're basic now, and boy, are they basic. This is frontier, but expensive. This is spirit on steroids. I've always had a good experience on Southwest, but this is probably gonna make me change my mind with who I'm flying just because there's not gonna be a real price discrepancy anymore.
- [15:09]
A
You know, Joe, you can't help but think that someone, you know, like Bob Jordan wasn't expecting that there would be blowback. I don't know if he expected it to be this severe, but why implement these changes in the first place?
- [15:22]
C
Well, I guess if you ask Bob, his answer would be that the customers wanted this change, at least where it came to open seating. They wanted to be able to get the assigned seat. But when you talk about bags fly free, which is something that they ended just a few months after they announced that they were going to end open seating, that was something that it's harder to make a case for the fact that customers wanted it. You definitely saw a lot of that stuff online where customers were saying we would prefer the bags fly free. And it was one of the main reasons why we chose to fly on Southwest in the first place. Southwest even did its own internal study and they found out that they would make about $1.5 billion a year if they charge for bags. But they also found out that they would lose $1.8 billion a year in customers leaving them for some other airline because they were angry with Southwest.
- [16:14]
A
So almost a wash, it sounds like.
- [16:16]
C
Yeah, yeah. Apparently the board of directors didn't see eye to eye with that survey. They felt maybe the numbers were not right and they've decided to give it a shot and see. We'll find out. It'd take probably about a year for us to know, but we'll know pretty soon.
- [16:32]
A
Well, I guess the question that was raised by one of Those comments on TikTok, is it in fact becoming a kind of pricier Spirit Airlines? I mean, it's not a Spirit. It does more than Spirit or Frontier do and it certainly has resisted charging for every little thing. But I'm sort of wondering if Southwest's low cost model is now a piece of aviation history. Maybe. What do you think?
- [16:57]
C
Well, I think if you put that question to the current CEO of United Airlines, he would say, yes, it's dead. In fact, that is exactly what he said just about a month ago. What are your thoughts on the budget airline model?
- [17:10]
A
It's dead.
- [17:12]
D
It's a crappy model.
- [17:13]
C
He said that the low cost model, the Spirit Airlines type model, the frontiers, they're not going to be able to succeed anymore. And his belief is because the legacy carriers, the Uniteds, the Americans, the Deltas, change what they do so much to try and match with basic economy fares. They've tried to match the low cost carriers on fares, but they also can offer a premium product to the people who are willing to pay for it, which happens to be right now more of the flyers than less. So it is possible that Southwest's old way of operating had to change or else they too would find themselves where Eastern Airlines and all the rest of the airlines Southwest once helped put out a business. They might find themselves in the scrapyard.
- [18:01]
A
Our guest is Joe Gwento. He's the writer of our Business wars series on Southwest. And when we come back, we're going to take a closer look at some of Southwest's more recent faux pas and what other changes might be in store. Stay with us.
- [18:17]
E
In 1925, 18 year old Howard Hughes inherited a fortune and he wasted no time putting it to use. With a million dollars burning a hole in his pocket, he headed west, determined to conquer America's booming new capital of entertainment, Hollywood. Hi, I'm Lindsey Graham, host of Wondery show Business Movers. We tell the true stories of business leaders who risked it all, the critical moments that define their journey, and the ideas that transform the way we live our lives. In our latest series, Howard Hughes clashes with Hollywood's power players as he fights to see his name in lights. But Howard has deep pockets and even deeper ambitions. And he revolutionizes the movie business by breaking rules and spending big. Because for Howard, the best way to level Hollywood's playing field is to explode the entire industry. Follow Business Movers on the Wondery app or wherever you get your podcasts. You can listen to new episodes of Business Movers early and ad free right now by joining Wondery.
- [19:09]
F
How hard is it to kill a planet? Maybe all it takes is a little drilling, some mining, and a whole lot of carbon pumped into the atmosphere. When you see what's left, it starts to look like a crime scene.
- [19:21]
D
Are we really safe? Is our water safe? You destroyed our tap.
- [19:25]
F
And crimes like that, they don't just happen.
- [19:28]
C
We call things accidents.
- [19:30]
D
There is no accident.
- [19:31]
A
This was 100% preventable.
- [19:35]
F
They're the result of choices by people. Ruthless oil tycoons, corrupt politicians, even organized crime. These are the stories we need to be telling about our changing planet. Stories of scams, murders and coverups that are about us and the things we're doing to either protect the earth or destroy it. Follow Lawless Planet on the Wondry app or wherever you get your podcasts. You can listen to new episodes of Lawless Planet early and ad free right now by joining Wondry plus in the Wondery app, Apple podcasts or Spotify.
- [20:15]
A
Hey, welcome back to Business Wars. Joe Gwinto is a business journalist who's covered Southwest Airlines for decades. In fact, he wrote our Business wars season covering this company. We were talking a little earlier about what made Southwest so different. One of the real differences was it had a kind of a non traditional route structure compared to other airlines. Could you say a little bit more about that and what's happened to Southwest in more recent years?
- [20:43]
C
Yeah, it was pretty easy to understand in the beginning days at first they flew just three cities. They flew from Dallas to San Antonio, from Dallas to Houston and then back. That was point to point service. It was one city to another. As they got a little bit bigger, they would fly still that kind of idea. But now you're flying from, say, Dallas to New Orleans or eventually Dallas to Los Angeles. They didn't have hubs in the sense that the major airlines do, the Americans and Deltas, where American has the big hub in Dallas and Delta has a big hub in Atlanta. And the idea there is they have a bunch of pilots, they have a bunch of planes, they route all the way, all kinds of passengers from smaller communities, through those big communities, and then out to the rest of the country. There are advantages and disadvantages to both of those networks. And I think as you've seen over time, as Southwest has gotten bigger across the country, they operate a little bit more like a hub and spoke than they, than they used to. But they still don't have those massive, we're going to feed everybody through Chicago kind of hub.
- [21:48]
A
You know, maybe this opens up a whole can of worms when it comes to what happened a few Christmases ago. And I think a lot of listeners know exactly what I'm talking about. Because of course, Southwest for years relied on what have been euphemistically described as legacy scheduling systems that a lot of some of the older carriers, legacy carriers, gave up a long time ago. Why did Southwest hold onto it? Because they just didn't need to upgrade those scheduling systems.
- [22:22]
C
Yeah, I think they felt like they would upgrade them sooner or later, but it became later and that became the problem. They were hearing internal voices inside the company from their flight attendants, from their pilots, that, hey, our scheduling systems are leaving us behind. We're having trouble getting rerouted when there's a flight cancellation and we need, as a crew, we need to go to another city and pick up a different flight. They were having problems well before the meltdown that happened in December 2022, around Christmas. And they just, they kind of waited a little bit too long to invest in change, even though they were hearing from all those internal voices in the company that were basically clamoring for it and saying, we're just one big storm system away from the whole network falling over. And that is exactly what happened in Christmas of 2022.
- [23:10]
A
You just mentioned a central point here that their flight attendants, pilots had been mentioning that we got to do something about this. And when there was that huge meltdown at Christmas of 2022, the holiday flights meltdown, I think a lot of Southwest employees who, again, traditionally had felt very much attached to the company. You could tell in some of their comments that they felt that the company was not paying attention to what they were experiencing firsthand. Do you think that's accurate?
- [23:45]
C
Yeah, for sure. Back in the. In the day, Herb Kelleher would hang out with the pilots and they'd all go drinking bourbon together. And, you know, they had a very familiar kind of relationship. And as Southwest kind of got bigger and maybe you could say they got more professional if you wanted to make that argument, some of that went away. And what happened in December 22 was something that the pilots and the flight attendants had been warning about for several years. And those years happened to coincide with the pilots and flight attendants also not having contracts. They were negotiating new contracts, they were working on their old contracts, and they were trying to get somewhere in the company, and they felt like they had not been listened to. And in fact, before the big Christmas meltdown, there was another, smaller meltdown, but essentially the same kind of problems that happened after a ground stop in Florida. And that was in October of 2021. And these, all the flight attendants and pilots after the big Christmas meltdown in 2022 said, you didn't listen to us in 2021. You didn't listen to us in 2022. What do we do now? Why aren't we being heard? Companies said that they were going to listen to them, and I guess something got heard because new contracts have been signed, and now the pilots and flight attendants make more than just about anybody else in the airline industry.
- [25:04]
A
What about that flight scheduling system? How far have they gone in upgrading that?
- [25:09]
C
Quite a bit. I haven't heard any complaining yet from the flight attendants and the pilots about how they've upgraded it. You know, overall, the changes they made since the Christmas meltdown are in the hundreds of millions of dollars. And the scheduling system was one of those things.
- [25:24]
A
What you're describing here, Joe, speaks to something bigger that Southwest has got to be feeling, talking about a revamping of their scheduling systems. That can't be cheap. And I know that historically, Southwest has tried their best to balance their bottom line without any mass layoffs. In fact, I don't think they had had any mass layoffs until fairly recently. That's gotta be a red flag for a company that's never done anything like this.
- [25:57]
C
Yeah, they've really been fighting a cost battle for the last several years. Really. Since the end of the pandemic, costs are up for all airlines and for A low cost carrier like Southwest costs, that's everything. That's the whole game. The less money they spend, the more money they make. And they've really struggled to get their costs under control since the pandemic. And they decided that one thing they needed to do was to trim staff. And they cut about 15% of their corporate staff at their Dallas headquarters.
- [26:28]
D
Wow.
- [26:28]
C
And as you said, it had never happened before. There had been a few labor disputes here and there over the years, but nothing ever came to strike. No one was ever laid off en masse. I think 1100 people being cut was a shock to a lot of the employees there because they counted on Southwest to have that employee first mentality. And Southwest made that cut as they were still profitable. So I think for a lot of employees, they thought, well, you're still making money. Why is my paycheck gone? And that's going to be something that we're going to have to see how that affects the culture in the coming months, because it could be very destructive.
- [27:09]
A
Is this about meeting shareholder expectations? Is that what this reflects?
- [27:14]
C
Yeah, it's certainly what a lot of people are arguing out there. There was an activist investor called Elliott Investment Management that took a large stake in Southwest at the summer of 2024. And they made their influence felt. They called for a lot of change. They wanted Bob Jordan to be fired. They wanted a lot of change on the board of directors. They felt that Southwest had become too insular, that Southwest did things the Southwest way just because it was the only way that they knew how to do things. And they felt that Southwest wasn't keeping up with the times. And in the end, Southwest made peace and Bob Jordan got to stay. But the board of directors was overhauled, and he essentially has new bosses. And a lot of people feel like those bosses are pulling the strings. And they're saying, you know, we don't really care what Southwest used to look like. What we care about is Southwest needs to make a lot more money in the future.
- [28:05]
A
Joe, with all these changes happening at Southwest, how do you feel about the company? Can it weather this turbulence?
- [28:12]
C
That's the multi billion dollar question. I guess I'm not entirely sure. I think that Southwest is such a big airline that it's hard to imagine that it could. But it is hard to see Southwest two years from now feeling like the same company that it felt like for the first 54 years of its existence. Because I think when you change so many things from a business perspective, but also do those cultural things that hurt when you have layoffs that employees are shocked by. When you take a free perk away from customers who counted on you for it, there's a lot to make up for. And you know, I know Bob Jordan believes that they're going to and he believes that Southwest is still going to feel like Southwest Airlines, but it's really not his call. We'll find out what the passengers think soon enough.
- [29:03]
A
Joe Gwento is a business journalist and the writer of this latest series of Business Wars.
- [29:08]
C
What a story.
- [29:09]
A
Joe, thanks so much for joining us on Business Wars. Been great to talk with you.
- [29:13]
C
Yeah, thank you, David. I appreciate it.
- [29:14]
A
Coming up, Aviation queen Bennet Wilson joins us to share why the cost of flying feels so sky high and what you can do to get the best deal.
- [29:28]
G
It's your man, Nick Cannon, and I'm here to bring you my new podcast, Nick Cannon at Night. I've heard y' all been needing some advice in the love department, so who better to help than yours truly? Nah, I'm serious. Every week I'm bringing out some of my celebrity friends and the best experts in the business to answer your most intimate relationship questions. Having problems with your man? We got you catching feelings for your sneaky link. Let's make sure it's the real deal first. Ready to bring toys into the bedroom? Let's talk about it. Consider this a non judgment zone to ask your questions when it comes to sex and modern dating in relationships, friendships, situations and everything in between, it's gonna be sexy, freaky, messy. And you know what? You'll just have to watch the show. So don't be shy, join the conversation and head over to YouTube to watch Nick Cannon at night or subscribe on the Wondery app or wherever you get your podcast. Want to watch episodes early and ad free? Join wondering plus right now.
- [30:31]
A
Hey, welcome back to to Business Wars. Anyone who's flown fairly regularly has probably felt the pain in their wallet at some point. Flights are expensive. An average ticket for U.S. domestic flights costs somewhere between 273 to $472, according to the Bureau of Labor Statistics, and it can get even pricier during peak season. Yet on paper, these costs are actually lower compared with decades past. That sticker shock can make travel planning that much more stressful. But have no fear because the aviation queen is here. Binae Wilson is a reporter at Bankrate, where she writes about credit cards, travel and personal finance. But the industry knows her as the aviation Queen. For her in depth coverage of the airline business. She's helping us understand current flight prices and why Our in flight experience doesn't always feel worth what we paid for it. Plus, she'll be walking us through some of the credit cards frequent flyers can use to help keep a little more cash for ourselves. B' Nai Wilson, welcome to Business Wars.
- [31:33]
D
Thank you. I'm so happy to be here.
- [31:35]
A
Tell us, though, how did you become the aviation queen?
- [31:38]
D
Well, David, I wrote about aviation for almost 25 years, and I'll just be blunt. I am a black woman in an industry that is still white male dominated. So I couldn't hide even if I wanted to, and I didn't want to. And I was at an industry event, and I walked in the room and one of my friends came up and said, you walked out in here like you were the aviation queen. And the name kind of caught on, and here I am.
- [32:04]
A
You know, I hear you are quite the fan of one airline in particular. Southwest, I understand. I hear you've got Southwest branded pajamas, towels, blankets, sheets today, David.
- [32:16]
D
Hand to God. Today I got a pair of Southwest Airlines socks.
- [32:22]
A
You mean you didn't have them already?
- [32:24]
D
I did not, but I have Southwest high top shoes.
- [32:27]
A
Get out. Really?
- [32:29]
D
Yes, I do.
- [32:29]
A
Why do you love Southwest so much?
- [32:31]
D
I think it's because they've always made me feel like they appreciate my business and appreciate me as a customer. The flight attendants are always very welcoming, and a lot of them are just hilarious, and they're just kind, warm, generous people. So they make me feel good. So I share the love with them.
- [32:52]
A
I love the love. I caught that. You thought you could slip that one in the love Airline. What was it that drew you to the aviation beat in the first place?
- [33:02]
D
Well, my father was an Air Force officer, and in 1971, we moved from California to a military base outside of London, and we had to fly from San Francisco to New York to London. And back then, flying was really only for the rich. We flew on a Pan Am 747 Queen Skies. It was amazing. We dressed up to travel. My sister and I had on our Sunday best hats, gloves, and patent leather shoes. And when we were in New York, our cousins stopped off to come and see us because most people had never been to an airport, never been on an airplane. So this was kind of a big deal. And I just fell in love with the industry.
- [33:46]
A
Do you have a nostalgia for the golden age of aviation and when do you think that would have been? I definitely have a sense myself about what the golden age of aviation was, but I'm cur if you have that sense, too.
- [33:59]
D
Probably the 1950s, right until the mid-70s, right before deregulation happened in 1978. I loved being able to have the privilege to fly like that back in the day. But I like where we are now. I like that people can afford to fly, because back then we couldn't have been on that plane if the military was not paying for us to be on that plane. Now, anybody who has some money and disposable income or even credit cards can go on a flight for a pretty reasonable price.
- [34:33]
A
You mentioned something. Airline deregulation. We're talking about the late 70s here. Could you tell us a little bit more about that chapter in aviation history? Because on the one hand, I think there are a lot of listeners who are thinking, wow, it's so expensive to fly. And yet, as you mentioned, talk about expensive. I mean, before airline deregulation, the idea of just going on a weekend trip was unthinkable, really. And you had to plan way in advance. And even then, you couldn't find anything like some of the fairs that you can find now.
- [35:09]
D
Yes, I actually have my grandmother's Pan Am ticket jacket. She came to visit us. She flew from Sacramento, California, to Brussels, Belgium, because that's where we were living. And I look at. I still have it, and I look at it, and she paid $483 for that fair back in 1972.
- [35:32]
A
Oh, my gosh. What would that be today? It's like, it would be in the thousands for sure.
- [35:36]
D
It would be about six, seven grand.
- [35:39]
A
Holy.
- [35:39]
D
You know, that was a lot of money back then. And, you know, that's a lot of money now today.
- [35:45]
C
Yeah, yeah.
- [35:46]
A
So that puts it in some perspective. Even though a lot of us complain about the high price of flying, you know, these days, if you want to get away, it's conceivable you can go someplace on 120 bucks. Of course, some of the bigger destinations, they're going to charge more, obviously, because the demand is greater.
- [36:04]
D
Can I push back a little on that?
- [36:05]
A
Absolutely, absolutely.
- [36:06]
D
Because I am actually going from Baltimore to Los Angeles in September for a big aviation geek fest. We go to LAX every year at the In N Out Burger, and we watch planes go, take off and land.
- [36:21]
A
That is so cool.
- [36:22]
D
And I went to Southwest and I was like, okay, I'm gonna go ahead and get this ticket. And my ticket for that flight came to a little over $200 round trip.
- [36:34]
A
David, that is amazing.
- [36:36]
D
But then on the other hand, I'm going to Tampa to visit a friend, and I'm going for the day and the fare from Baltimore to Tampa was $451. So I cashed in Southwest points to take that flight.
- [36:50]
A
Aha. Okay, quick. Why is it that it cost more to fly to Tampa, which was closer in, than it was to, say, go to la? I mean, what's the story there?
- [37:00]
D
I asked a friend who was in the industry, and it's just yield management. The fares go up where there's demand, and the fares go down when there's not as much demand.
- [37:11]
A
So it seems like really one of the biggest places where things have changed since deregulation is as they expected it to, the sort of supply and demand model, I guess, determining what prices are. And I think that's one of the most frustrating things that you deal with if you're a frequent flyer. Can you say more about how flights are priced? Because I have gotten the sense that sometimes if I've been searching for a flight, the mere act of searching for it is causing these prices to go up. I must be going out of my mind. Tell me I'm not.
- [37:46]
D
You are not. Not only that, but there are some airlines that will send an email or a text saying that fare you were looking at is still available. And so I will go on my Google Chrome and do incognito searches or I will go on Google flights to. To see my options before I actually go ahead and book a flight.
- [38:09]
A
So the airlines are watching you watch them?
- [38:12]
D
Yes.
- [38:13]
A
Yikes. How do you go about finding the best prices?
- [38:17]
D
9 times out of 10, I am going on Southwest, so I just go directly to Southwest. I also like to go to bargain sites like Secret Flying. I took my family to Japan for my child's 10th birthday and secret Flying had a fair that was came up to $1,700 for the three of us to go to Japan.
- [38:41]
A
What is Secret Flying? You don't know which carrier you're flying? Is that the secret or what?
- [38:45]
D
No, no. The secret is sometimes there are mistake fares or just cut fares. And that particular day, I just happened to see this fare for Tokyo and I jumped on it. You have to jump on it because if you don't, I don't know if you heard. Back in 2014, there was glitch with Emirates and people were getting flights for like $200.
- [39:08]
A
I forgot about that. Yeah, that was crazy. That was absolutely crazy. So those kinds of things happen, and they happen more frequently, I guess, than many of us realize.
- [39:16]
D
And I'm still angry because I was in Paris for Christmas and by the time I found out about it, it was Already over.
- [39:23]
A
You are the credit card expert as well as being the aviation queen. So, Madam Queen, you, Highness, what is the best credit card to help rake in the rewards?
- [39:35]
D
I have two cards that I recommend. There are people who don't want to sit and try to figure out if I pay for dining, I'll get three points and if I pay for something else, you know, they don't want to figure out all the points configurations. I'm a big fan of the Capital One Venture card. The Capital One Venture Card is a flat 2 miles per dollar spent and that's it. It doesn't matter what you're buying. They have airline partners and hotel partners. You can redeem them. You can use the miles to quote, unquote, pay for flights that you've already purchased. And it's just easy for people who don't want to do all of the math.
- [40:13]
A
Does Chase have something similar?
- [40:16]
D
Yes, Chase does too. And that's the other card that I was going to recommend, the Chase Sapphire Preferred. You can get higher points for travel related things like airlines, trains, sub buses, transportation, dining, and it's one point for everything else. So that is a good card.
- [40:34]
A
I read that there's an annual fee on this card that's out of this world.
- [40:39]
D
Well, no, that's the reserve. The Chase Sapphire Preferred and the Capital One venture are both $95 a year.
- [40:45]
A
Oh, that's not so bad. Okay, well that's good, that's good. But, but I know that American Express, some of those travel cards, I'm thinking of the Platinum in particular, very popular among travelers. The fee is like 695 or something like that. It's crazy.
- [41:01]
D
That is correct. And it's getting ready to go up. We don't know how much yet. But you know, it does come with some stellar benefits. So you have to decide. The Capital One also has the Capital One Venture X which was their entry into the luxury card market. And it's 395 a year. So it's quite the bargain.
- [41:19]
A
How do those cards that have the logo of the airline on it them, you know, like the Delta American Express card. How do they compare with the other credit cards that are out there that seem to be sort of pro traveler?
- [41:33]
D
I always tell people with airline credit cards, if you are loyal to an airline, so let's say you're loyal to Delta, then it's good to have a Delta card in your wallet. But if you're not loyal, Delta is also a Chase Airline partner. So you could rack up your points on a Chase Sapphire preferred or reserve and then transfer those points to Delta.
- [41:58]
C
Yeah.
- [41:59]
A
You sound like you'd be such a fun person to fly with. I must say, being the Aviation Queen, I would be derelict in my duties if I didn't ask you to share with us your best piece of advice for frequent fliers.
- [42:13]
D
My best piece of advice is to pack your patience and be kind. I go to way too many airports where I see frequent flyers. Rightfully so. They're frustrated. But yelling at a ticket agent, a gate agent, a flight attendant, any people on the ground or in the air does nothing. They're doing the very best that they can. And, you know, I just. I like to give people grace as much as possible.
- [42:41]
A
So travel with a smile, even if you have to force it. It.
- [42:44]
D
Yes. Yes.
- [42:47]
A
Bennet Wilson is also known as the Aviation Queen, a lead writer at Bankrate, where she covers credit cards, among other things. You can check out her reporting@bankrate.com Benet it's been a real pleasure to get to go on this journey with you. Thanks so much for joining us on Business Wars.
- [43:03]
D
David, it was such an absolute pleasure. Thank you so much.
- [43:07]
A
Coming up, five guys Shake Shack. They've made a big mark with higher quality ingredients. But as these better burger chains make it big, they have to compete in an overstuffed market and against the ultimate burger behemoth, McDonald's. From Wondery. This is episode three of Can Southwest Airlines Survive for Business Wars? I'm your host, David Brown. Kelly. Kyle produced this episode. Peter A.R. cooney is our senior interview producer. Our lead sound designer is Kyle Randall. Our producers are Tristan Donovan of Yellow Ant and Kate Young. Our audio engineer is Sergio Enriquez. Our managing producer is Desi Blalock. Our senior managing producer is Callum Plews. Our senior producers are Emily Frost and Dave Schilling. Our executive producers are Jenny Lauer Beckman and Marshall Louie Wondering.