"The airline knows that in fairly quick order many fewer Americans can afford to travel."
Do you have stats for this?
I travel a lot. Mostly internationally. I am Diamond with Delta, which is their top-tier status.
2020-2023, I was upgraded to first class probably 90% of the time on domestic flights. For international flights, I was occasionally upgraded, even though most airline company policies to dot promote upgrades to premium cabins on international flights. But, I could always use an upgrade certificate and get up front that way.
Not anymore. With the exception of two of my 2024 flights, the flights themselves were booked solid. Not even an empty seat next to me. Most of my 2024 upgrade certificates expired, unused, because to use them there needs to be an empty seat in that cabin, and there were none. Airlines are not going to offer an upgrade, even with a certificate, if they can sell that seat for more money.
To JPW's point, Southwest's problem is not that it isn't cheap enough or that travelers have less money, but the exact opposite. They are willing to spend more on travel and want to purchase premium cabins. Southwest doesn't offer that. They offer slightly less expensive seats with far fewer amenities. It also operates out of off-brand airports that lack the connections or the amenities of the major hubs.
Other US low-cost carriers seem to be in a similar spot. I know that where I live in Europe, I can take Wizz or Ryan for dirt cheap. But you're leaving out of some abandoned military airfield at midnight or 6am, and everything is ala carte. Sometimes it's just easier to fly Lufthansa, even if it is more expensive.
