The Low Cost Carriers are starting to have a huge battle with costs. JetBlue learned it could lose money this quarter, and Southwest is facing a huge, 600 million dollar, fuel cost increase as its hedges are running out. So now the battle  is to increase ticket prices to remain viable companies.

We need a higher average fare for our tickets,” said David Neeleman, chief executive officer at JetBlue, which reported its first quarterly loss this month and is forecasting a loss for all of 2006.
“We need to get another five bucks or 10 bucks if we really want to make some money,” he said.
Laura Wright, chief financial officer at Southwest, said it’s facing $600 million in higher fuel costs this year and will need to cover that expense.
“We’re going to have to see revenue improvement to cover those fuel costs,” she said. via Seattle PI.

It is a very rough time to be an airline. The industry needs to determine a pricing structure that works for themselves and the customers.