LCCs: The Failed Experiment

Low-Cost Carriers (LCCs) cannot work in the US

LCC and ULCCs, difference is leanness. Note: Alaska Airline is not an LCC.

The United States has tried for decades now to make the LCC (low-cost carrier) model work and thrive from coast to coast. From Spirit, JetBlue, Breeze Airways, and Frontier Airlines to Southwest, Sun Country, Allegiant, and Avelo, to name only the most prominent LCCs, most have either failed (such as Spirit), or are operating on a razor’s edge margin. The reasons are fairly clear once you understand how the model operates.

Low-cost airlines, or LCCs, and Ultra-Low-Cost Carriers (ULCCs), work by operating on a series of thin margins of economic viability who in turn choose to pass their savings onto you, the consumer. I will, in this piece, illustrate five points of operational failure of the LCC model in the United States.

ULCCs/ULCCs work by operating a regulatory minimum fuel load (RMFL) per flight, a buy-on-board menu, at most, the process of nickel-and-diming passengers for all services that would otherwise be included with the ticket price on legacy carriers, and of course, flying lean or at most, minimal, in terms of baggage-carrying and their policies thereof.

A noted decision that doomed low-cost carriers in the US was a choice to fly into primary airports instead of secondary. This is not a problem in Europe (or to an extent, in Asia) where secondary or even tertiary airports, which often are former or current lightly-used military airfields. These airports also have (at least minimal) customs facilities so that one could fly from London to Paris quite easily per European Union laws. By contrast, few secondary airports in the United States have customs facilities. Midway is, of course, secondary to O’Hare in Chicago, other examples are LaGuardia in New York (secondary to JFK), the Los Angeles area has several, notably Hollywood-Burbank Airport, John Wayne-Santa Ana Airport, Ventura Municipal Airport; all are seen simply as feeder airports to LAX. Topping the list are Ft. Lauderdale-Hollywood Airport, subordinating Orlando International Airport, and Oakland SF Bay Airport, subordinating San Francisco International; one, San Francisco, is the gateway to the Pacific, the other is simply the gateway to the Bay Area. San Jose is the tertiary airport in the Bay Area. None of these secondary airports in the US have customs facilities. Many of these airports can only offer international travel from US Customs Preclearance locations.

Labor costs also need to be addressed. Customs officers in the US are hired and operated under the umbrella of the Department of Homeland Security (DHS) and are not easily lent out; these officers and their attendant equipment are incredibly expensive, to the point where only the most important or largest airports can afford to hire and maintain them. These are costs that are usually in partiality offset (again in part though it is sizable depending on the airport) by airlines that seek to or do in fact rent gates at given airports.

Passenger density is a crucial factor to consider. Europe and Asia especially have a much higher overall population density than comparable locations in the United States. London, Paris, Frankfurt, Berlin, Lisbon, and Madrid, Tokyo, Beijing, Hong Kong, and many other cities and regions are roughly 3–4.5 times as dense as equivalent regions in the US.

You are likely saying “Brooke, population density does not equal passengers!” I can hear that now. Let me explain. Population density equals raw numbers which equals overall asymmetrical passenger growth. Let me use some numbers to back up my point; in 2025 alone, Europe’s largest “budget” low-cost carrier, Dublin-based Ryanair, flew 208 million individual passengers. The United States has a total population of 347 million people, of which 267 million are college- or voting-age adults, aged 18 and over. Of these, only 49% of those adults have valid passports (if children are included, the percentage increases to 56%). This total number is just 140 million more than Ryanair flew last year, and 60 million less than the total adult population of the European Union.

Ryanair’s popular “workhorse” Boeing 737–8 (next generation)

However, Ryanair does not mislead passengers; yes, a flight on Ryanair is a terrible flight and a pain depending on the route, with no route being more than 3 hours in total duration. But they only charge you about 15–20 Euros per ticket, which is about the price of two large coffees at Starbucks. For that price, you get a seat. Just a seat, and only a seat, no add-ons, no checked luggage, no in-person check-in without a fee, no drinks on board without a fee, but this is upfront and in the contract of carriage.

American passengers, in the wake of COVID, have also begun to see the value in premium travel, deciding to fly transcontinental, or regionally in, say, Domestic First class on United Airlines, as opposed to standard base fare on Frontier Airlines. 170 million people have decided to apply for passports in the aftermath of COVID (2023-present), and most of that number who opt for international travel, do so on board premium accommodations.

Lastly, the metaphorical ‘sword of Damocles’ that doomed Spirit Airlines in 2026 beyond the possibility of recovery and served as a stark warning to the LCCs that continued to exist. The ongoing Iran War, which has seen the closing of the Strait of Hormuz. This Strait holds 5% of the world’s crude and refined natural gas, and liquid Natural Gas (abbreviated as LNG) and sees that oil traffic routinely pass through the Strait annually. This closure of the Strait has driven the oil prices per barrel up by 28% on average. Legacy carriers can weather this. Low-cost carriers can not as illustrated by the complete demise of Spirit Airlines.

These factors are so severe that airlines such as Southwest and even the ULCC king, Frontier, are changing their business model to mimic legacy carriers, getting rid of low-cost perks.

Frontier Airlines’ affordable Airbus A320–200

I hope this clears up confusion on why the LCC model has failed to achieve success with counterparts in Europe and Asia. See and learn much more at brookeintheairtravel.net!