Airlines Boost Profits Through Ancillary Fees as EU Mandates Free Carry-On Allowance
As the summer travel season begins, Israeli airports are preparing for a surge in passengers, with Ben Gurion Airport expecting around 90,000 travelers daily next week and a total of 2.3 million in July. Traditionally, flight tickets included all essentials, but today, passengers often pay extra for basic add-ons like checked luggage and seat selection. This shift stems from the rise of low-cost carriers, which initially offered cheap base fares but charged separately for additional services, turning ancillary products into a major revenue source.
Experts highlight that while low-cost tickets may seem inexpensive, the total cost often doubles once extras are added. For example, Ryanair reported that ancillary revenues accounted for 32% of its total income, about 5 billion euros, and EasyJet earned nearly 2.6 billion pounds from such services in 2025. Israeli airlines also rely heavily on these fees, with Israir generating $60 million from ancillary products in 2025, a 40% increase from the previous year, and El Al earning $167 million from ancillary services out of $3.1 billion in passenger revenue.
Prices for luggage and seat selection vary among Israeli carriers. For instance, Arkia charges $50 for a 20 kg checked bag and $25 for an 8 kg carry-on if booked in advance, while Israir's fees are $65 and $30 respectively. El Al includes a carry-on in all flights and checked luggage on U.S. routes, with upgrades available for other destinations. Experts note that this pricing model encourages passengers to spend more after purchasing a low base fare, describing it as a "honey trap".
Recently, the European Union approved reforms requiring airlines to include a free carry-on bag up to 7 kg with every ticket, effective in mid-2027. This change targets low-cost carriers like Ryanair and Wizz Air and is expected to reduce unexpected fees for travelers. Industry specialists see this as a significant consumer benefit and hope similar regulations will be adopted in Israel. They also anticipate that competition will prevent airlines from simply raising base fares to offset the new rules, potentially making ticket prices more transparent and fair.
Despite the annoyance of extra charges, the low-cost model has made air travel more accessible, capturing nearly 30% of the market share at Ben Gurion Airport before the pandemic. However, experts agree that ancillary fees have become disproportionately high, often representing pure profit for airlines. The EU reforms may mark the start of a shift toward more balanced pricing and improved passenger rights.
