easyJet’s new two tier hold baggage pricing system is designed to appeal to customers, but could simply impact ancillary revenues

Low-fare carrier easyJet hopes a new lower price for lighter hold bags could ultimately persuade more passengers to pay to place luggage in the hold and overcome the increasing problem of overhead cabin baggage space. In a move that could ultimately impact its income from bag fees, the airline is introducing a two tiered system charging from £8.99 and £13.99 per leg dependent upon luggage weight.

Rather than a flat rate charge, which starts from £13.99 for an up to 20kg bag, easyJet has introduced a cheaper option, staring from £8.99, for bags up to 15kg offering customers what it describes as “greater choice and value”. It is also increasing its standard hold baggage allowance by 15% and permitting bags of up to 23kg within the higher hold baggage rate.

The airline says the changes are based on customer feedback about how they want to travel and believes the new cheaper option is perfect for passengers travelling on shorter business trips or short breaks. It also hopes the reduced rate will appeal to many customers that are currently squeezing everything into a small cabin bag to avoid the previous flat rate charge.

easyJet says analysis of internal data shows that in the last year almost half of passengers’ hold bags weighed 15kg or less and these passengers would now be able to take advantage of the new lower rate. It notes that there were also millions of customers who required more weight than it previously allowed with the 20kg bag and were previously hit with excess baggage fees.

“Our new products better match those customers’ needs, ensuring we offer value for money choices for everyone, regardless of trip type or duration,” says Andrew Middleton, ancillary revenue director, easyJet. The new hold luggage options are available exclusively online with immediate effect on all new flight bookings.

At first glance, it appears that this is a customer experience project that will enhance choice for passengers but not necessarily deliver increased revenue for the business. Based on the data from the airline for the past year, it shows could lose around a fifth of its hold baggage revenue by passengers using the cheaper tier of booking. It will hope the lower price point will influence more passengers to purchase the hold bag option, but price is not the only discriminatory factor when choosing to travel with just hand luggage.