Thursday, January 6, 2011

Southwest ups the Ante

Up until now, the rewards programs offered by low-cost carriers in the United States have fallen well short of those of the so-called legacy carriers. 

On March 1, Southwest Airlines -- America's largest low-cost carrier, and already a perennial favorite among budget travelers because it doesn't charge fees for first or second checked bags -- will unveil a new and improved form of its Rapid Rewards frequent flyer program. 

Highlights include:
  • All rewards will be unrestricted, with access to every seat on every flight.
  • Every day will be eligible for reward travel.
  • Points won't expire as long as your account has some activity every 24 months.
Southwest will be keeping its A-List and Companion Pass elite benefits and is also introducing a new A-List Preferred level designed to compete with legacy programs' upper-tier elite levels, with benefits like 100% point bonuses for flights and dedicated phone lines for reservations.

Speaking of points, the new program will be point-based rather than using the credit system that Southwest has had thus far.  Credits will continue to be redeemable under the old system, and flyers with credits left to use up will be able to use their points to acquire additional credits (at a rate of 1200 points for one credit) towards a previous-generation reward.

Bottom line: Southwest has upped the ante.  Combined with its pending acquisition of AirTran, this new Rapid Rewards program makes Southwest a compelling choice for domestic business travelers.

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