Penalties for low-cost airlines will make flying more expensive, says easyJet boss | easyJet

The boss of easyJet has described as “illegal” fines imposed on the airline and other budget airlines for charging carry-on baggage and seat reservation fees and warned that the decision will make flying more expensive.

EasyJet was hit with a €29m (£24.2m) fine by Spain’s Ministry of Consumer Rights earlier this month, along with Ryanair, which received the highest penalty at €108m, and other airlines including Vueling, Norwegian and Volotea.

easyJet’s outgoing chief executive Johan Lundgren, who is stepping down at the end of the year after seven years at the helm, described the fine as “anti-consumer” and insisted on offering passengers paid extras that gave them a choice.

“We offer people the opportunity to do what they pay for. “A third of our customers don’t opt ​​for additional services at all,” Lundgren told the BBC’s Radio 4 Today programme.

He added that imposing the fines would “increase the underlying fare. It will make flying and traveling more expensive for people who don’t want this type of product.”

This came as easyJet reported an operating profit of £597m for the year ended September 30, up 25% from a year earlier, although it was below analysts’ expectations.

The latest results from Lundgren’s tenure showed that easyJet’s ancillary revenue – including baggage fees, seat reservations and in-flight catering costs – increased compared to the previous year.

Ancillary sales rose 4% year-on-year to £24.45 per seat as the company said its ancillary products resulted in “improved revenue generation through price optimization”.

Lundgren said the increase in additional revenue was “driven by demand,” adding that customers would not buy the extras on offer if they felt there was no value for money.

“If you look at the overall price, the price increase this summer is £1,” Lundgren said.

Sustained demand for international travel helped easyJet carry more passengers during the year, carrying 89.7 million passengers in the 12 months to September 30, almost 7 million more than a year earlier when it carried 82.8 million.

The airline has also seen higher demand for its package holidays and expects its holiday customer base to grow by around 25% in the coming year.

Lundgren will hand over the reins to the airline’s current chief financial officer, Kenton Jarvis, on January 1, 2025, although he will remain with the company until May.

The airline said it expects to pay shareholders a dividend of 12.1pa, up from 4.5p in 2023, which will cost it £92m if approved by investors at its annual shareholders meeting.