Southwest Airlines isn’t my favorite carrier, but I definitely think they have their uses. I’ve flown them many times, particularly on short flights from my home in Southern California to Northern California, Las Vegas, or Phoenix, and can’t really complain much about the value. Some of my one-way flights were for just 2.5K points, which I usually transferred from Ultimate Rewards. You simply can’t beat that value.
Almost one year ago, Southwest devalued their Rapid Rewards program to make redemptions less valuable by about 15%. Any devaluation is a bummer, but this one was relatively mild and good values could still be had.
Today, Southwest released some updates to their Rapid Rewards program that basically state that prices will now essentially be dynamic. Here’s the important text:
Beginning April 17, 2015, the number of Rapid Rewards Points needed to redeem for certain flights will vary based on destination, time, day of travel, demand, fare class, and other factors. However, there are still many flights which will stay at the current redemption rate. And don’t forget that when fares go on sale, so do the points needed for redeeming for a reward flight on those fares.
So there will be changes to a lot of tickets, but not to others. You can bet that more popular markets and flights will have increased prices on most occasions, but it’s hard to say exactly how this will affect the majority of the flights. It would be an interesting analysis to note several airfares the day before the change and review them again after the changes take place.
This is a Southwest devalution in my mind. While some prices may get cheaper, you can bet they’re making this change to increase a majority of prices. I find this interesting because, in theory, this is what a revenue-based redemption model already does to a large extent.
More popular routes, days, and times, are generally more expensive anyway. And since the amount of points required for a redemption is based on the actual price of the ticket, it sort of already works the way Southwest describes the new program will.
I will be curious to see how this works out.