Why Is Southwest Finally Joining OTAs after 19 Years of Direct Sales?
What happened?
In August 2025, Southwest Airlines signed a direct distribution agreement with Booking Holdings.
For the first time, Southwest’s inventory will be available on Booking Holdings’ platforms, including Priceline, Booking.com, and Agoda.
This shift reflects a major change in the airline’s nearly two-decade-long strategy of selling exclusively through its direct channels.
Southwest began relaxing its distribution restrictions in February 2025, introducing sales through Expedia Group sites. The Booking deal is the next step in that evolution.
Why does it matter?
Low-cost carriers (LCCs) like Southwest historically avoided OTAs to keep distribution costs as low as possible and maintain close control over customer interactions, pricing, and loyalty programs.
OTAs invest in marketing, SEO, and app interfaces, which results in high commissions—not so appealing for many LCCs.
In contrast, full-service carriers (FSCs) piggyback on that marketing reach as they can afford it. FSCs often have more differentiated offerings (business or first class, premium economy, lounges, etc.), and they use OTAs to expose those offerings to more potential customers.
Take a look at AltexSoft’s video for a more detailed comparison of full-service vs. low-cost airlines.
Will this deal change bookings for travelers?
Not at all.
Southwest’s flights are visible on Priceline, Booking.com, and Agoda with full fare details, such as Wanna Get Away, Anytime, and Business Select options.
Customers can still earn Rapid Rewards points and qualify for Priceline VIP status. All tickets will carry the same fare transparency, flexibility, and baggage allowances that customers expect when booking directly with Southwest.
Are these partnerships already paying off for Southwest?
Yes, results to date indicate clear advantages.
During its August 2025 earnings call, Expedia Group reported that the collaboration with Southwest had delivered “fantastic results,” contributing about 5 percent of the airline’s passenger volume in Q2 2025 alone.
This level of incremental sales can generate substantial revenue growth despite the new burden of OTA distribution costs, which Southwest has avoided for years in favor of zero-commission direct bookings.
We can only assume that the Booking Holdings deal will unlock similar growth.
What made Southwest switch its long-standing approach?
Southwest recognized that its absence on third-party channels had limited its visibility and growth opportunities, particularly as travelers increasingly use OTAs to compare options and purchase bundled products.
According to the Travelport Retailing Report, 88 percent prefer to see all flight options and fares on one screen, while 54 percent use a comparison site to search for information before purchasing their ticket.
Most Millennials (70 percent) and Gen X (64 percent) prefer to book via OTAs, citing choice and price transparency.
Moreover, the partnership with Expedia delivered satisfying results, prompting Southwest to go further into OTA distribution and collaborate with Booking Holdings.
Photo by Forsaken Films on Unsplash