U2 is not always low-cost and never no-service. The service on most LCC is quite often much better than on "full service" airlines. The fact that you have to pay for catering is insignificant, as the catering on the full service carriers is hardly anything to write home about and certainly not worth the price difference.

If you look at LCCs like U2 or AirAsia I would say that they are much better at short haul than (most) full service European carriers. I don't think that LCC are at the bottom of the race we often refer to. I think it might be the other way around.

Makes sense, as short haul operational excellence is not the FSCs business model, but it is for EasyJet and the likes.