NEW YORK (CNN/Money) - United Airlines had many troubles that landed it in bankruptcy court Monday, but probably none will be as difficult to overcome as the growth of the low-fare air carriers.

Led by Southwest Airlines (LUV: Research, Estimates), now the nation's No. 5 carrier, along with fast-growing upstart JetBlue Airways (JBLU: Research, Estimates), the discount carriers have shown tremendous growth, and profitability, in the industry's most troubled time.

In 2000 the six largest low-fare carriers -- Southwest, JetBlue as well as Alaska Air (ALK: Research, Estimates), American Trans Air (ATAH: Research, Estimates), AirTrans (AAI: Research, Estimates) and privately held Spirit Airlines -- equaled about 55 percent of United's traffic. In the first 11 months of this year the six had combined traffic equal to about 80 percent of United's total.

More importantly for industry economics, the low-fare carriers are playing a huge role in driving down fares of the larger airlines that operate flights on a so-called "hub and spoke" network of routes. Lower fares and fewer passengers for the network carriers have produced deep losses for all those carriers the last two years, and likely will leave them in the red in 2003.

"If you look at Southwest Airlines, they're the ones setting the agenda," said Michael Miller, president of airline consultant Miller Air Group. "Maybe 10 years ago they weren't that prevalent. They didn't affect the whole industry as they do now."

Not all the low-fare carriers are rousing successes. Spirit sought and was denied $54 million in federal loan guarantees because of questions about the airline's ability to repay the loan, just as United was on a much larger scale.

But Southwest is the one major carrier that has continued to report profits throughout this period, and upstart JetBlue has also been able to avoid losses for the last six quarters to grow to the nation's 11th largest carrier less than three years after its first flight. It bucked both a weak aviation and initial public offering market to have a successful IPO earlier this year.

The low-fare carriers not only have lower labor costs, they also aren't trying to support the large network of flights traditionally seen as needed by the major airlines to give their lucrative business passengers the chance to fly wherever they want, whenever they want to get there.

Most don't have their schedules dominated by major hubs where flights all arrive at about the same time, and wait while passengers transfer from one flight to another, which allows greater aircraft productivity. Many of the low-cost carriers also aim to serve the secondary airports, rather than the congested airports traditionally preferred by business travelers. Southwest uses Midway Airport in Chicago, rather than O'Hare International, and Love Field in Dallas, rather than Dallas-Fort Worth. It doesn't even serve a New York City or Washington, D.C., airport, instead flying to Long Island, N.Y., and Baltimore.

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"We're not 20th in line for takeoff somewhere, eating up airplane and crew time," said Southwest spokeswoman Beth Harbin.

But the major difference is that most of the discount carriers are not going after the business traveler who is willing to pay top dollar for first class cabins or a large selection of cities served. That means that when there's a drop in business travel, it's not as keenly felt by those carriers.

"All the major carriers except for Southwest have tried to be the Lamborghini. They've tried to get all their profits from the richest part of the industry. And as you've seen in the auto industry, everyone can't be a Lamborghini producer. Airlines have had too much reliance on business class travel, and too many high-priced fares that have been their lifeblood."

During the economic boom of the late 1990s and early 2000, there seemed to be enough business travelers to go around. But with the slowing of the economy, the business travel fell faster than lower-priced leisure travel, so many of the discount carriers were better positioned to weather the storm.

Glenn Tilton, chairman and CEO of UAL, talks about the bankruptcy and future for the airline. Play video (QuickTime, Real or Windows Media)

"The No. 1 problem [for United] is the hub and spoke model isn't working in the post dot.com and post 9/11 era," said airline consultant Jim Craun of Eclat Consulting. "The networks are a good thing, and they're here to stay. But they cost a lot of money to run, and the industry has to do some things to get the networks more efficient. The business model for hub and spoke got out of whack because during the dot.com bubble, they were raising fares because they could and they didn't do the things they needed to do."

None of the consultants believe that the hub and spoke carriers or the attention to business carriers is going to go away. Even Southwest said it doesn't believe its successful business model spells doom for its larger competitors.

"There's room in the market, we believe, for everyone," said Harbin. "Southwest isn't for every single customer out there."

But many do believe that the continued growth in low-fare carriers will place continued pressure on the major network carriers and their fare structure.

Already, industry-leading American Airlines (AMR: Research, Estimates) and Delta Air Lines (DAL: Research, Estimates) have announced plans to restructure their business fares, closing some of the gap between the upper and lower fares. American has also announced plans to restructure its network, spreading out the period that flights arrive in order to better utilize equipment, gates and personnel.

"I think the major network carriers will pretty much have to stay network carriers," said Craun. "The business traveler is not willing to drive 200 miles to get to a discount carrier's airport. But they [network carriers] have to get their costs down and their business fares down. And if they don't, there won't be as many network carriers."

United CEO Glenn Tilton said Monday he expects United will look pretty much as it does today when it emerges from bankruptcy. But he acknowledged that the airline needs to move away from its dependance on business travelers and face the Southwest challenge.

"United will have to address the issue of the competition from low-cost carriers," said Tilton. "United is going to have to broaden our appeal to more customers than simply high-end customers. United is going to have understand that, in the aggregate, there are fewer customers out there, so we have to appeal to them all."