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Southwest ( LUV ) considers wide-body aircraft for long-haul

international routes

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New premium lounges to boost loyalty revenue and credit

card

appeal

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Southwest's ( LUV ) margins lag behind Delta and United Airlines

(Adds more comments, background details throughout)

By Rajesh Kumar Singh

CHICAGO, Sept 11 (Reuters) - Southwest Airlines ( LUV )

CEO Bob Jordan said on Thursday the company is looking at

long-haul international flights and premium airport lounges as

part of its turnaround strategy.

Jordan said while the company will have to look at a

wide-body aircraft for long-haul international service, it could

use a "more risk-tolerant" approach at first and choose a

narrow body to serve those routes.

The Dallas-based carrier, which operates mostly domestic

flights with a fleet of Boeing 737 jets, has been struggling to

find its footing after the COVID-19 pandemic. Its lackluster

earnings have fueled pressure to revamp its business model.

It has begun charging customers for checked bags, ending a

free policy. It has also rolled out a new basic-economy fare and

would switch to a new assigned seat policy in January, replacing

its previous open seating model.

In the past, Jordan has talked of the company's aspirations

to launch flights to Europe. Industry experts say a lack of

long-haul international flights limits Southwest's ( LUV ) appeal to

customers and has deprived the airline of a high-margin revenue

stream.

Since February, Southwest ( LUV ) has launched partnerships with

foreign carriers Icelandair, China Airlines, and EVA Air to

broaden its network. The company has said it is exploring new

partnerships from all parts of the globe.

But Jordan said the company wants to serve long-haul

international routes itself. "We want to serve those

destinations as well," he told a Morgan Stanley conference,

adding the plans were still in the initial stages.

Southwest ( LUV ) once boasted a record 47 consecutive years of

profit prior to the pandemic. Since then, it has struggled to

regain sustained profitability. Its margins currently pale in

comparison with those of rivals Delta and United

Airlines.

Many of Southwest's ( LUV ) recent pivots are aimed at wooing

high-spending travelers. Jordan said the company ends up losing

customers to other carriers because it currently does not fly to

destinations like London or have premium airport lounges.

He said the lounges are also expected to drive up the

company's loyalty revenue as they would make its co-branded

credit cards more attractive to customers.

"If we're going to continue to drive relevance, even as the

largest domestic carrier, we've got to continue to meet the

needs of our customers," Jordan said.