The Winners and Losers of Ultra Cheap Flights

The discount airline business in the U.S. has long promised cheap tickets to anyone willing to pack light and skip the frills. Picture a traveler eyeing a $49 fare to Las Vegas, only to watch add-on fees for bags, seats, and snacks climb toward full-service prices. That model powered carriers like Spirit Airlines for years, but lately it feels more like a house of cards in a windstorm. Spirit Airlines serves as a stark example of how the game has changed, with its recent Chapter 11 bankruptcy filing and takeover talks highlighting deeper troubles across the sector. 

These airlines built their empires on a simple idea: strip out everything but the flight itself and charge extra for the rest. Spirit pioneered this ultra-low-cost approach, offering rock-bottom base fares while piling on fees for carry-ons, checked bags, seat selection, and even water. Customers who paid only the base price flew squeezed into tight seats with no free snacks or entertainment. This worked when fuel was cheap and leisure travelers flocked to Florida beaches or Vegas weekends without much complaint.

Frontier Airlines and Allegiant Air followed suit, crowding popular routes with similar no-frills service. Southwest Airlines, though not as extreme, kept fares low with free bags and a point-to-point network that avoided big hubs. The formula delivered growth through the 2010s, as passengers traded comfort for savings. Market share data shows these budget players grabbed about 15% of domestic U.S. flights combined by 2019, with Spirit alone hitting 5.5% at its peak. But success bred competition, and soon the skies filled with cut-rate options that undercut each other. 

Post-pandemic reality hit hard. Fuel costs soared, labor shortages drove up wages, and big carriers like Delta and United rolled out basic economy fares that matched budget prices while offering more reliability. Travelers began to notice when Spirit flights sat on tarmacs or canceled outright, souring the bargain. Consumer sentiment shifted too; surveys showed fewer people willing to endure the full fee stack for a truly cheap trip. Spirit’s market share slipped to around 4% by late 2025, ranking it seventh among U.S. carriers, just ahead of Frontier at 3.7%.

Pricing models that once seemed genius turned into traps. With everyone slashing fares to fill seats, revenues per passenger dropped below costs. Spirit filed for bankruptcy protection in August 2025, its second in a year, forcing cuts to 25% of its schedule and thousands of furloughs. Cities like San Diego and Salt Lake lost service as the airline shrank to focus on strongholds like Fort Lauderdale and Orlando. Rivals pounced, with United adding Florida routes and Frontier planning 20 new ones in Spirit’s backyard. Sentiment trends reflect this pain; Spirit’s on-time performance improved to third-best in 2025 at 78.83%, yet its net promoter score only recently climbed after years of complaints. 

Not every budget airline stumbles. Southwest holds steady as the low-cost leader with 17.8% market share, drawing passengers who want predictability over the ultra-cheap gamble. Allegiant and Sun Country thrive in niche markets, serving smaller cities with vacation charters that avoid head-on fights with giants. Frontier eyes growth but faces its own merger heartaches, having failed to buy Spirit despite recent talks. 

These survivors tweak the model smartly. Southwest tests premium options like extra legroom, while even Spirit rolled out bundled fares and free Wi-Fi to boost appeal. Bigger airlines win indirectly, capturing budget flyers with basic economy while pushing premium seats to higher spenders. Affluent travelers ramp up spending on comfort, leaving low-income households with fewer true bargains. Spirit schedules 26.7 million seats for 2026, still seventh overall, but analysts see its path forward tied to a Castlelake takeover that could reshape the field. 

Spirit’s story reveals how thin margins and fierce rivalry doom the purest budget plays. Bankruptcy let it shed debt and rethink routes, aiming for 9% annual growth from 2027 with a smaller Airbus fleet of 125 to 140 planes. Yet United’s CEO calls the ultra-low model dead, as network carriers flood leisure markets with competitive fares. Consumer trends favor reliability over rock-bottom prices, with loyalty programs and perks swaying choices. 

Frontier and others watch closely, balancing expansion with caution. The sector consolidates as weak players exit, leaving room for adaptable budget carriers to coexist with giants. Travelers benefit from more options, but the era of endless $29 fares fades as costs catch up with reality.