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Southwest Airlines Reveals $35 Bag Fee. How to Avoid It—but You’ll Have to Be Quick. - Barron's

1. Southwest ends its free checked bags policy after 54 years, starting this week. 2. New fees are $35 for the first bag and $45 for a second bag. 3. Stock initially rose 8% upon announcement, but remains flat around $30. 4. Southwest's stock fluctuated between $24 and $34.84 since March. 5. Tariff developments impact airline stocks, alongside Southwest's policy change.

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FAQ

Why Bullish?

The fee change enhances revenue, potentially improving profitability. Similar historical examples show such fee changes can lead to positive stock responses.

How important is it?

The change impacts consumer behavior and revenue, which are critical to stock performance.

Why Short Term?

Immediate stock fluctuations are expected as market reacts to the new policy. Investors will quickly factor in revenue increases from new fees.

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