Facing ever-increasing competition, Southwest Airlines could change its policy of not charging baggage fees at some point, CEO Gary Kelly said on CNBC Thursday, right after the company reported better-than-expected earnings.

"There are no plans to charge for bags in 2013," he said in a "Squawk Box" interview, but added, "Never say never ... the customers will tell us whether they would prefer to have extra fees or whether they would prefer to have everything bundled."

Kelly added that the industry is facing pressure due to higher fuel costs, which weighed on fourth-quarter profits. Southwest did earn $0.09 a share, excluding one-time items, a penny higher than estimates. Revenue of $4.2 billion was just shy expectations. It also saw higher operating expenses and a decline in passenger traffic.

The industry landscape is changing and that's a challenge, Kelly said. "Over the last 10 years … you do have low-cost carriers entering the market."

"Every single legacy carrier has gone through bankruptcy. Gotten their costs down significantly," he said.

Kelly also said the industry is not growing. "The capacity in 2012 was actually down again. And that's what I would expect the [domestic] industry to do … here again in 2013."

Forget perfume, watches and cigarettes. Just when you thought upper-class in-flight shopping couldn't get any swankier, Virgin Atlantic has announced it will sell works of art to passengers from the comfort of their seats.

All during February, elite passengers flying between New York and London will be able to view and purchase paintings by British street artist Ben Eine. The art will be available for view at Virgin Atlantic's clubhouses or lounges at JFK, Newark and Heathrow airports, the company said in a statement Tuesday.

Passengers flying the route can view the pieces on the ground, and then buy them in flight in the "Gallery in the Air."

Southwest Airlines on Monday announced a new $40 fee to let passengers board early — the latest carrier to charge additional fees for everything from priority boarding to guaranteed seats next to your kids.

Southwest's new boarding option will only be offered at the gate on the day of travel, beginning 45 minutes before the flight departs, the company said in a press release. Priority seating allows passengers to get ahead of the slow and crowded boarding process and to stow carry-on bags before the overhead bins fill up.

With the days of all-inclusive fares long gone, passengers grumble at being charged extra along every point of the travel process. But recent data from Airfarewatchdog.com, a travel blog, suggests one of the few amenities passengers are willing to pay extra for is a hot meal.

Southwest tested its new boarding option and fee in San Diego last month.

Even as it tries to emerge from bankruptcy and eyes a possible merger with US Airways, American Airlines is busy with a new project: a face lift.

The carrier unveiled its first new logo and aircraft livery in decades on Thursday, with brighter colors, an "updated eagle" peeking out from a ribbon, a more contemporary font and bold red-white-and-blue stripes for its fleet's tails.

The edgy marketing department at Spirit Airlines is at it again, making obvious reference in a new airfare sale to the confusing girlfriend hoax plaguing Notre Dame football star Manti Te'o.

"There's no hoax here ... Spirit's fares REALLY are low," reads the intro to the airfare sale on Spirit's website. "So, if your girlfriend is around (and real), plan that trip that you've been talking about without paying too much for it. And tell those high fares to RIP!," it continues.

(Read More: Spirit Airlines Raising Carry-On Bag Fee to $100)

United Airlines is attempting an airfare hike of up to $20 round-trip on domestic tickets. This is the carrier's second push for a fare increase this month.

Airfare tracking website FareCompare.comreported the increase Wednesday, noting the higher prices are based on distance, with shorter trips going up $4 and longer distance routes increasing by $20 round-trip.

As of Thursday, JetBlue is the only airline to match United's increase, Rick Seaney, chief executive of FareCompare.com, said.

Following a second significant incident involving a Boeing 787 Dreamliner, investigators are focusing on the lithium-ion batteries used in the new airplanes.

"The battery was always going to be a focus of the investigation into what's happening with the Dreamliner," says Hans Weber, aviation consultant with Tecop International Inc. "This incident is only going to reinforce that."

Smoke in the Cockpit, Strange Smell in the Cabin

On Wednesday, an All Nippon Airways flight in Japan made an emergency landing after battery warning lights went off in the cockpit. According to the National Transportation Safety Board, the ANA crew "reported smoke in the cockpit and an odor in the cabin. The airplane subsequently landed, and passengers and crew evacuated via emergency slides."

(Read More: Japan: The Test Case for Boeing's Dreamliner Woes?)

Kayak is now offering travelers advice on when to buy their airline tickets by predicting whether the price for a flight will rise or fall during the next week.

The fare comparison site's new feature provides a recommendation to "book now" if the ticket price is expected to rise in the next week—or to "wait" if the price could drop.