What Is a Low-Cost Carrier?

The Phoenix fare you bookmarked was the cheapest on the page. A carry-on fee applied each way, and you paid for a seat near the front for a 2 p.m. kickoff.

When the client moved the meeting, a same-day change fee followed. The "low-cost" ticket cost more than the full-service fare one row down.

Five things come next: what makes a carrier low-cost, how the three tiers differ, what flying one actually costs, when it clears for a business trip, and how to compare carriers without extra legwork. You'll walk away judging the next cheap fare by its total price instead of the number on the search page.

What Actually Makes an Airline a Low-Cost Carrier

"Low-cost" describes what the airline spends to fly you. Low-cost carriers keep base fares down by stripping services out of the ticket and running simplified operations, often on one aircraft family, then earn a large share of revenue from ancillary fees such as bags and seat selection. LCCs measure costs in cost per available seat mile (CASM), the average cost to fly one seat one mile. They push CASM down with high aircraft utilization and dense seating on point-to-point routes. Southwest operates an all-Boeing 737 fleet to simplify scheduling and maintenance, and uses less congested airports such as Dallas Love Field, Houston Hobby, and Chicago Midway.

The tiers are converging as Southwest has added assigned seating and raised its bag fees to $45 and $55 for the first two checked bags, and Delta, United, and American sell basic economy fares with LCC-style restrictions.

Low-Cost, Ultra-Low-Cost, and Full-Service Carriers

The base fare decides the tier: low-cost, ultra-low-cost, or full-service. Each tier bundles a different amount into that fare by default, seat selection, baggage, and meal service, and charges accordingly for whatever it leaves out. Southwest and JetBlue sit closest to full-service on that spectrum, while Frontier and Allegiant built their model around unbundling nearly everything.

Low-Cost Carriers (LCCs)

Southwest and JetBlue make up the US low-cost tier. Both sell an unbundled base fare and price extras separately on mostly domestic routes. Southwest's Basic fare has no advance seat selection and no changes, while its higher fares change without a fee. JetBlue's Blue Basic includes a carry-on but no checked bag.

Ultra-Low-Cost Carriers (ULCCs)

Frontier's ticket includes one personal item; carry-ons, checked bags, and seats cost extra, with seats from $15 per segment and Frontier bag fees of $79, $89, and $150 for tickets bought on or after April 4, 2026. Allegiant follows the same model, charging separately for a carry-on and a seat. Spirit ceased all passenger operations on May 2, 2026, and is now being wound down and liquidated in bankruptcy court.

Full-Service (Legacy) Carriers

Delta, United, and American run hub networks and include a carry-on on standard fares. When they cancel, they rebook on another airline. On basic economy, their cheapest fare class, the three restrict seat selection, changes, and mileage earning, United allows only a personal item, and American goes furthest, with a 24-hour change lockout on basic fares.

What Flying a Low-Cost Carrier Actually Costs a Business Traveler

A Frontier base fare covers only a seat and a personal item. Add a carry-on bag ($39 to $65)and a seat assignment ($5 to $50), and the total cost often lands within $20 to $40 of a legacy carrier's main cabin fare on the same route. With a laptop bag and a change of clothes, a carry-on bag is often unavoidable, and a seat near the front matters when you land with just enough time for a 2 p.m. meeting.

Frontier charges a $149 change fee within 59 days of departure for bookings from September 25, 2026, and $0 only at 60 or more days out or on a bundle.

Allegiant, Frontier, and Southwest rebook you on their own next flight but don't commit to rebooking on another airline at no cost, while Alaska, American, Delta, JetBlue, and United do. If the carrier's next seat isn't until tomorrow, that flight is your only option.

Compare fares using the total trip cost rather than the sticker price.

When a Low-Cost Carrier Makes Sense for Business Travel

A low-cost fare fits a business trip under these conditions.

• The route is short and nonstop, so add-ons apply to one segment each way.
• You can travel with only a personal item.
• No meeting depends on a connection the airline won't rebook across carriers.
• Your company's policy on fare caps requires the lowest available option, and the LCC fare clears it with the add-ons you need.
• You're booking 60 or more days out, when Frontier's change fee drops to $0.

Outside those conditions, the all-in cost can land close to or above a full-service ticket, and on Allegiant, Frontier, and Southwest you also give up rebooking on another airline.

Comparing Carriers Without Checking Five Different Sites

Online travel agencies and metasearch sites show the base fare, while carry-on, checked bag, seat, and change fees sit on the carrier's site, and no rule forces the two onto the same page. An appeals court vacated the DOT rule that would've required bag and change fees to appear during itinerary search.

Otto the Agent intermingles NDC content with GDS content, so it searches the full range of airline offerings, LCC fares included, and surfaces them in one place, in web, iOS and Android apps, and MCP-enabled experiences. Travelers finish the booking directly in the same conversation they started it.

Fares on Frontier, Allegiant, Breeze, Avelo, and Sun Country are generally non-refundable and return a credit or voucher rather than cash on a voluntary cancellation. A refundable fare can fall in price after you pay.

Judge the Fare by the Total Trip Cost, Not the Sticker Price

With Otto, you can search all airline offerings and book your choice. Otto compares low-cost fares with full-service tickets through its NDC content mixed with GDS content, so you don't have to visit individual carrier sites. Otto tracks only fully refundable flight reservations booked through it, so post-booking price monitoring won't apply to most LCC bookings. If the price on a refundable full-service fare drops, Otto alerts you and, once you approve, cancels and rebooks at the lower price with the refund back on your card.

Sign up for Otto to compare low-cost and full-service fares before you lock in a ticket.

Frequently Asked Questions

What's the difference between a low-cost carrier and a legacy airline?

Legacy airlines differ most from low-cost carriers on standard fares, which include more by default, such as a free checked bag and advance seat selection. The gap narrows at the bottom tier, where legacy basic economy restricts seats and miles much like an LCC's cheapest fare class.

Are ultra-low-cost carriers the same as low-cost carriers?

Ultra-low-cost carriers are a stricter subset of low-cost carriers, charging for things most LCCs still include. A ULCC such as Frontier charges for a full-size carry-on, while JetBlue includes one on every fare. Frontier now also sells bundles with no change fees, blurring that line further.

Do low-cost carriers charge for carry-on bags?

Some low-cost carriers do. Frontier and Allegiant charge for a full-size carry-on, while JetBlue's Blue Basic fare includes one. United's basic economy allows only a personal item domestically, and a bag that won't fit under the seat gets the standard checked-bag fee plus a separate $25 gate-handling charge.

Is flying a low-cost carrier actually cheaper for a business trip?

Often not once the add-ons are added back in. Buy bags and seats online when you book, since the same add-ons cost more at the airport, then add them to the base fare and compare that final sum against the main-cabin fare on a full-service carrier before you decide.

How do I compare a low-cost carrier's total price against a full-service fare without checking multiple sites?

Carry-on, checked bag, seat and change fees sit on the carrier's own site, separate from the base fare most search tools show. Otto surfaces low-cost and full-service fares together from one search, and travelers finish the booking directly in the same conversation they started it.