Low Cost Carriers

Southwest, Frontier, Spirit in the US; Ryanair, Wizz, Easyjet in Europe; Scoot, Air Asia X, Jetstar in Asia. These are but a handful of the low-cost airlines in operation today. Born of deregulation, low-cost carriers entered the market to provide an alternative to the “traditional” carriers by offering rock-bottom fares. So what are some of the differences? We’ve set out some of the key points that differentiate the low-cost carriers from full-service airlines below. Of course, this list is not universal and often the lines between full-service and low-cost are getting blurred as the airlines are competing amongst one another. Some might call it a race to the bottom at times, but it’s the effect of the open market that is driving these commercial decisions. Ultimately we, the consumers, want to pay less and get the most but sometimes service comes at a cost.

Even within the low-cost segment there is further differentiation. Some airlines such as Ryanair and Spirit bill themselves as completely no-frills. I.e. you are buying transportation for yourself from point A to point B. For everything else, there is a charge. Let’s get in to the nitty-gritty.

Baggage Fees:

One of the things that the low-cost carrier model has brought to the airline industry are baggage fees. Many airlines and flights will now charge you to take even one piece of luggage. Ancillary fees now make up most of the profits of an airline which is the result of charging as little as they can for the ticket getting you from A to B. Prices in base fares have in many cases come down, or not risen as much as inflation; thanks in part to airlines charging extra for what was once included in the fare.

Seat Selection:

Many low-cost carriers have re-defined how we determine where we sit on the plane. Some airlines such as Southwest don’t print seat numbers on the boarding pass, but instead it is a free-for-all and first-come-first-served model. Of course, the airlines have also found a way of capitalizing on this and some will offer you the opportunity to purchase early access to the plane. So while it’s not a dedicated seat, you’ll have the opportunity to get an earlier pick of the best seats.
Some low-cost carriers are doing away with this model entirely and will assign you a seat of their choosing, whereby you can change the seat for a fee. Better seats costing more than less desirable seats, of course. And we even see this model in full-service airlines whereby seats with extra legroom, or closer to the front of the plane are offered at an additional cost, or available only to elite frequent fliers. A handful of full-service airlines will charge for seat selection for any seat.