Jetstar will charge A$25 for overhead bin bags from 2027, a first for Australian airlines. The fee tests how far budget carriers can push ancillary revenue without alienating travellers used to full-service norms.
Jetstar will charge passengers for using overhead lockers starting February 2027, a move that makes the Qantas-owned budget carrier the first Australian airline to monetise cabin bag space. The fee, from A$25 ($18) one way, covers a bag weighing up to 10 kilograms stowed above the seat. A purse, laptop bag or small backpack that fits under the seat stays free, with the current 7-kilogram weight limit scrapped for that item.
The policy follows a pattern already common among low-cost carriers in the United States and Europe. Spirit Airlines, Frontier and Ryanair charge for carry-on bags that go in the overhead bin. Jetstar CEO Stephanie Tully said in a statement that the change “can make better use of overhead locker space, streamline boarding and help more flights depart on time.” The carrier cited passenger and staff feedback that weighing bags at the gate and fighting for locker room were among the most stressful parts of flying.
Sharon Petersen, CEO of AirlineRatings.com, said the fee will “ruffle feathers because Australian travelers have got such high expectations.” For decades, full-service options dominated the domestic market, and budget carriers have only gradually unbundled fares. Checked luggage, seat selection and meals are already separate charges on most Australian low-cost airlines.
The question for the sector is whether the overhead-locker fee represents a one-off test or a new revenue line that other carriers will replicate. Jetstar’s base fares remain higher than those of European ultra-low-cost rivals, Petersen noted. “Australia lacks that level of competition and because wages, taxes and operating costs sit much higher here,” she said. That pricing cushion gives Jetstar room to experiment with new ancillary fees without losing price-sensitive travellers to a cheaper competitor – for now.
A successful rollout could encourage Virgin Australia’s low-cost arm, Bonza or even full-service carriers to introduce similar charges. The downside risk is customer backlash. Australian travellers have not been conditioned to pay for cabin bags the way they have for checked luggage. If Jetstar sees a drop in booking conversion or a spike in complaints, other airlines will likely wait.
Jetstar said the change will reduce frustrations at boarding gates. Petersen said the carrier’s starting price is “generally well above what Ryanair or Wizz Air can offer.” The fee structure will vary by route, with the A$25 starting point likely to rise on popular leisure destinations such as Bali, Phuket and Queenstown. The airline did not disclose a revenue target for the new charge.
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