Southwest Airlines Got Beat Out By A Bank For A Lounge Concept At One Of Its Busiest Airports, At Least For Now

Published Nov 4, 2026, 7:00 AM EST Luke Diaz is a freelance military writer with experience with active duty experience in the US Navy as well as defense and industrial engineering. He is a former Naval Flight Officer who performed tactical air control on the carrier-based E-2 Hawkeye. As Southwest Airlines continues its transformation into a new business that more closely resembles a legacy airline than a low-cost carrier, the opening of its first lounges is highly anticipated by many customers. Yet many have noted that the first four airports slated to debut Southwest Icon lounges do not include one of the busiest airfields in the carrier's network. Despite the fact that SWA flew 17.2 million passengers through Phoenix Sky Harbor International Airport (PHX) in 2025, it didn't make the cut for the 2027 list. Austin, Baltimore, Honolulu, and Nashville will cut ribbons on the airline's inaugural airport lounges. The reasoning comes down to PHX's JPMorgan Chase Sapphire Lounge by The Club, which is already partnered with SWA. The 2024 lounge at Sky Harbor was essentially a proof of concept. Chase showed it could successfully operate a premium lounge inside a high-traffic Southwest terminal. Because Southwest had a strict 'no lounges' policy for over 50 years to keep fares low, they sat on the sidelines while its flyers used services provided through Chase credit card rewards instead. The Phoenix lounge is uniquely positioned to become a hybrid or future location for a partnered space, likely tied to the new SWA premium credit card coming next year. Chase Got There First Credit: Paul Bickford | Shutterstock View from the Wing reported that Chase and lounge operator The Club worked together to build the lounge that currently sits in Terminal 4's South 1 Concourse. It is an eight-gate wing of Sky Harbor that Southwest uses as its base. American Airlines passengers can reach it within a short walk from their own concourse, so Chase not only serves many SWA travelers but AA flyers as well. The lounge covers just over 3,500 square feet (325 square meters) and has 78 seats, which made it the smallest in Chase's network when it opened. Design firm Corgan styled the interior to match the concourse's regional styles and built the space around one unusual object: a restored 1963 Airstream trailer. The Airstream was originally built off-site in Arizona, then a crane lifted it into the terminal. Crews rolled the vintage trailer into place in the hours between the last flight of one night and the first flight of the next morning, so that no passenger ever saw the work. Today, it sits on a patio facing the concourse. Instead of building all new sites, Chase and SWA can use that existing airport real estate to instantly give new cardholders premium hubs to walk into when the new program launches in 2027. SWA's upcoming lounges are being developed explicitly in partnership with Chase and are heavily inspired by the Sapphire Lounge network. SWA recently confirmed in its earnings reports that it plans to expand the Southwest Icon network to at least 11 total locations over the coming years, and only the first four have been named, which has led many to speculate that PHX is on the short list for the next round. Phoenix Is Big For Southwest Credit: Markus Mainka | Shutterstock Phoenix is a two-tenant airport, and many of those passengers are only changing. According to the airport's 2025 numbers, as compiled by View from the Wing, Sky Harbor handled 51,618,649 passengers, and American and Southwest together carried nearly three-quarters of them. Below is a table of the 2025 traffic by market share at PHX according to Road Genius: Airline Total Traffic Market Share American Airlines 20,890,000 40.50% Southwest Airlines 17,200,000 33.30% Delta Air Lines 3,660,000 7.10% United Airlines 3,220,000 6.20% Frontier Airlines 2,300,000 4.50% Alaska Airlines 1,730,000 3.40% WestJet 470,000 0.90% JetBlue Airways 320,000 0.60% Air Canada 290,000 0.60% Sun Country 280,000 0.50% A person with a layover and an hour to fill is the customer a lounge is built for, and Southwest ferries a large number of them every day in Phoenix. As KVIA reported from the airline's release, construction had already started on the first four lounges, in Austin, Baltimore/Washington, Honolulu, and Nashville, with openings expected in late 2027. Tony Roach, Executive Vice President, made this comment in the recent press release: “Southwest Airlines has built one of the most trusted brands in travel by delivering authentic hospitality that customers value. Our lounges will be a natural extension of that experience, offering customers a place to relax and experience the Southwest brand in a new way. The introduction of a lounge network represents a strategic investment in Rapid Rewards and deepens our 30-year partnership with Chase.” Entry is expected to be granted as a benefit of the new premium Rapid Rewards credit card that Chase plans to launch in 2027. Phoenix is not among the first four, even though it is one of Southwest's biggest airports. The reason seems to be space rather than demand, and the Chase lounge shows how short on space Terminal 4 is. The Lounge Filled Up Fast Credit: Robin Guess | Shutterstock When Chase originally opened the Sapphire Lounge in PHX Terminal 4 in late 2024, it was visually impressive but very small. The timeline of changes shows how high demand and business strategy moved in parallel with SWA's dramatic corporate transformation. Chase opened the room on November 12, 2024, in a 3,500-square-foot space with a maximum capacity of just 78 people. The lounge was instantly overwhelmed by extreme crowding and long waitlists. In June 2025, it added an advance reservation system, a feature that, according to Thrifty Traveler, no other Sapphire Lounge in the network offered. More recently, Chase underwent a major physical expansion project through September, taking over neighboring real estate to drastically increase seating capacity and add more natural light to the space. In addition to expanding the lounge, Chase is restricting access in a move that foreshadows how entry will change when the updated Rapid Rewards partnership launches next year. General Priority Pass members are no longer allowed access, and the advanced reservation system was shut down. By kicking out general airport travelers and physically building more space, Chase spent the last year optimizing the lounge exclusively for high-tier cardholders. Chase Is A Partner, Not A Rival Credit: Robin Guess | Shutterstock Tony Roach, Southwest's chief customer and brand officer, called the new lounge network a strategic investment in Rapid Rewards, according to Business Traveller. Chase has issued Southwest's Rapid Rewards credit cards for roughly 30 years. That money is a large but mostly invisible part of the airline's business, and a lounge gives customers something real to see and use, which helps Chase sell a premium card and gives Southwest another reason for people to keep spending inside its loyalty program. View from the Wing describes how bank lounges are viewed now. Once seen as threats because they pulled premium travelers and card business away from airline clubs, today they make a hub more attractive. The airline also does not have to pay for them. In Phoenix, that helps both AA and SWA, since passengers of either can walk to the Chase lounge just as easily. A Sapphire Reserve cardholder sitting in SWA's concourse is, first of all, Chase's premium customer, and SWA's new card is meant to put the airline at the center of that spending. The first Icon Lounges are being built to Chase's Sapphire network standards, but Travel Points Playbook argues that Southwest probably would not want its lounge in the same terminal as a Chase Sapphire Lounge. That traffic deconfliction would rule out LaGuardia and Las Vegas and possibly Phoenix as well. It judged Phoenix the least conflicted of the three, because Southwest's gates there are spread out and the Chase space is still relatively small. So the obstacle in Phoenix is less Chase itself than the plain question of where a second lounge would be most beneficial. Where A Southwest Lounge Could Go Credit: Robin Guess | Shutterstock View from the Wing says Houston Hobby, Chicago Midway, Las Vegas, Vegas, and Phoenix all make sense given the current traffic in the SWA network. The challenge is finding space near the airline's gates. Las Vegas and Phoenix have the passenger numbers, but it is not fully clear where a lounge would fit into the terminal layout. Midway is almost entirely a Southwest airport but also offers little obvious real estate for a large club. Phoenix has one big lounge project under way, but it is in the wrong place. The Terminal 3 North concourse is adding six gates and 173,000 square feet, plus a 10,000-square-foot (929-square-meter) lounge on a mezzanine level, with the building expected to begin basic functions in 2027. Terminal 3 is separate from Terminal 4, and because Sky Harbor's terminals are not connected after security, a Southwest passenger in Terminal 4 would have to go back through security to reach it. In September, Phoenix Sky Harbor also named AA the main airline for a new $4.5 billion terminal targeted to open in a plot of free space, though the airport has not said who will get which gates. If Southwest waits for that space, a Phoenix lounge built exclusively for the airline may turn out to be a story for the 2030s rather than 2027.