The world’s largest low-cost carrier is eyeing huge expansion plans when it comes to its new lounge offering. Dallas-based Southwest Airlines recently won approval to open its first lounge at Honolulu International Airport, and its Chief Executive Officer believes growing a lounge network could be a huge drawcard for high-spending customers.

Southwest Airlines, the carrier that transports more passengers domestically in the United States than any other carrier, has an extensive network of flights to/from and within the United States. The airline is looking to attract more premium travelers with the potential growth of its own lounge network.

Attracting Premium Travelers

While Southwest Airlines remains a low-cost carrier, it has been reported to be ‘actively pursuing’ the potential of a wider network of airport lounges. This comes as the industry continues to attract more premium travelers, and airlines are a part of it. It has been reported that Southwest continues to discuss airport leases with respective airports and the potential for a national lounge network. The airline looks to the success of this with its card partner, Chase.

The airline’s CEO, Bob Jordan, knows that the opportunity for a lounge network would ensure loyalty and growth for the airline, which would enable the airline to offer a premium credit card that would include lounge access. While the airline is reluctant to put a timeframe on its lounge ambitions, Jordan explained to CNBC what it could mean for Southwest:

« I think lounges would be a huge, next benefit for our customers. You [would] have a lounge network that allows you to offer that premium credit card that provides lounge access. »

First Stop: Honolulu

This October, Southwest gained approval for the lease to establish an airline lounge at Honolulu Daniel K. Inouye International Airport (HNL). It is expected to span over two floors and cover 12,000 square feet. Located in Terminal 2, where all Southwest Airlines flights operate, this will be the airline’s first attempt at an airport lounge.

For Southwest, its move into the premium space comes at a time when passengers are looking for more. The airline has decided it must widen its product offering to offer more inclusions, such as premium seating, airport lounges, and maybe even, one day, long-haul flights.

It remains unclear when the Honolulu lounge will greet its first guests, but approval has been received, and construction is expected to start soon. This lounge is likely to be just the first, with the airline clearly hinting at future announcements to enhance its overall customer benefits.

Continuing To Change The Business Model

Through heat from one of the airline’s key investors, Elliott Investment Management, Southwest has more recently looked to adjust its business model to shift away from the free-for-all unallocated seating and charging customers to check a bag. Also looking to improve the onboard experience, Southwest has started offering in-flight connectivity through free WiFi for those who are linked to the carrier’s frequent flyer program, Rapid Rewards.

Jordan has hinted that this could be just the beginning of improving connectivity as the airline is working with other onboard providers, such as SpaceX Starlink. With more than 800 aircraft in its fleet, WiFi is currently available on most flights. and enables free messaging, streaming of movies and television shows, and is active throughout the flight.

Many legacy carriers, such as American Airlines, Delta Air Lines, and United Airlines, have for a long time offered an extensive lounge network for their premium passengers, along with partnerships with credit card companies to attract high-level spending customers. Credit card companies have also created an established presence at most major airports, with the likes of American Express, Capital One, and Chase also making the most of this market.

As suggested by a report by JD Power, 82% of all passengers who were surveyed noted that they primarily chose an airline depending on whether they could get lounge access. For Southwest, the airline is finally waking up to what could be a more lucrative way to attract higher spending travelers. The real question remains: where is the Southwest Airlines lounge likely to pop up next?