BudgetVSInclusiveFeature

Budget vs all-inclusive carriers

Is it still cheaper to fly low-cost if you have to pay for baggage and other extras?

Everyone wants to get the best deal for their airfares, but how do you know if you’re really getting the lowest price? Budget airlines naturally have lower fares, but if you need to take checked baggage, want an in-flight meal, prefer to pick your own seat or anything else, it will generally cost extra. Full-service airlines, on the other hand, have higher fares but automatically include these services at no extra cost.

Is it really cheaper to fly a budget airline once all the costs are included? To find out, we looked at the different fare types of four of Australia’s top airlines.

Adding up the costs

Our traveller today is a single person booking a one-way flight from Sydney to Adelaide, for Saturday 1 July. They have 20kg of checked baggage with them, a preference for picking their own seat and are looking forward to an in-flight meal or snack.

The cheapest flights available here are the basic Jetstar and Tigerair flights without any extras added. Both are identically priced at $89. However, with the full range of extras added, the basic Jetstar economy starter fare ends up being the cheapest, coming in slightly ahead of Tigerair.

For the all-inclusive carriers, Virgin Australia edged out Qantas’s prices, coming in at $165 to Qantas’s $184.

Here’s a breakdown of prices for this flight.

PriceChecked luggageSeat selection (standard only)In-flight meal or snackEligible for frequent flyers?Total
Jetstar (economy starter)$89$18$6$6No$119
Jetstar (Plus)$124IncludedIncludedIncludedYes$124
Tigerair (Light)$89$18$5$10.50Yes$122.50
Tigerair (Express)$103$18Included$10.50Yes$131.50
Virgin Australia (Getaway)$165IncludedIncludedIncludedYes$165
Qantas (Red eDeal)$184IncludedIncludedIncludedYes$184

The cheapest overall

For this trip, Jetstar comes out as the cheapest. However, a few small changes can shift the order. For example, our traveller today is tucking into the cheapest available meal on his Tigerair flight, enjoying a $10.50 sausage roll. No such luxuries await on the Jetstar flight, however, with the only refreshments available being a light snack for $6, or a $5 in-flight meal voucher with the Jetstar Plus fare.

So Tigerair does better food, which naturally costs more than what you’ll pay with Jetstar, but once you remove this from the equation, Tigerair actually comes out $1 cheaper than Jetstar, thanks to the slightly cheaper seat selection.

Don’t care where you sit? You can scrap this fee too, at which point Tigerair and Jetstar are offering identical prices for this flight; $89 for the ticket and $18 for 20kg of checked baggage.


To bundle or not to bundle?

Who’s got time to manually add each option when booking a flight? Here, a bundled deal can come to the rescue, automatically adding extras to the Jetstar and Tigerair flights so that you don’t have to.

With both the Jetstar Plus and the Tigerair Express bundles, you’re generally paying exactly as much for each feature as you would if you added them manually. With Jetstar, however, the Plus bundle costs $5 more than if you were to add everything by hand.

This might be because that bundle also lets you earn frequent flyer points, which you can’t do with a Jetstar economy starter fare. If you want all the extras and those points are worth more than $5 to you, it might be well worth bundling with Jetstar.

The Tigerair Express bundle adds some additional features, specifically the “queue jump” advance boarding for $3 and front-of-plane or standard seat selection ($11 for front-of-plane). It costs an additional $14 to bundle these and it would cost the exact same amount to add these features to a standard fare.

Generally, you can’t save any money by bundling, so if there’s any part of the bundle that you wouldn’t pay money for, it’s better value to just opt for the standard fare and add on the things you want.

However, bundling can save you some time and with Jetstar, it can also earn you points.


How baggage costs can change that final price

Because the final prices are relatively similar for equivalent airlines, the best value carrier for you might actually depend on how much luggage you’re taking.

Each airline has default restrictions on the standard amount of baggage you can take:

  • Jetstar: Carry-on only, up to 7kg
  • Tigerair: Carry-on only, up to 7kg
  • Qantas: Up to 7kg of carry-on, up to 23kg of checked baggage
  • Virgin Australia: Up to 7kg of carry-on, up to 23kg of checked baggage

If you need to add a checked bag, both Tigerair and Jetstar charge the same amount for it:

  • 15kg: $16
  • 20kg: $18
  • 25kg: $25
  • 30kg: $30
  • 35kg: $35
  • 40kg: $40

In addition to this, if you’re travelling with more than 7kg but still only have carry-on luggage, Tigerair has an upgrade for you. It will allow you take up to 12kg of carry-on luggage for $17, which is slightly cheaper than taking a checked bag.

For both Qantas and Virgin Australia, economy class passengers can travel with up to 30kg of luggage, split between one carry-on bag and one checked bag, without needing to purchase any upgrades.

Flying with an oversized bag or with sporting equipment like skis or golf clubs also means additional charges depending on the airline:

  • Jetstar: $25
  • Tigerair: $35
  • Virgin Australia: $35
  • Qantas: $35

Virgin Australia and Qantas will allow you to check these items in like another piece of luggage, but if this pushes you above your luggage limit then a $35 fee will apply. If it’s the only piece of checked baggage that you’re bringing then you won’t have to pay any extra for sporting gear.

Jetstar and Tigerair, however, will simply charge you a flat additional fee for travelling with these items.

With the variations in baggage costs, in some situations it might end up being significantly cheaper for you to fly with a full-service airline rather than a budget one.


When is it cheaper to fly full-service?

Consider the exact same traveller as before, except this time their luggage is a little bit bigger and heavier. Now it’s 21kg and one of its dimensions is longer than 1 metre, qualifying it as an oversized item.

Ticket costLuggage costOversized item feeTotal cost
Jetstar$89$25$25$139
Virgin Australia$165IncludedNone

$165

With one small difference, the price difference between the Jetstar and Virgin Australia flights has now shrunk to only $26. Add in $6 for standard seat selection and $6 for an inflight snack with Jetstar and now there’s only a $14 difference between the fares. In other less usual situations, it can even become considerably cheaper to fly with an all-inclusive carrier.

One of the perks of the Qantas Club program, the Qantas Frequent Flyer program and Virgin Australia’s Velocity program is that they can get you an increased luggage allowance, even at fairly elementary membership levels.

Qantas Club and Qantas Frequent Flyer programs (economy class)

  • No membership: 1 bag up to 23kg
  • Qantas Club member or Silver Qantas Frequent Flyer: 1 bag up to 32kg
  • Gold or Platinum Qantas Frequent Flyer: 2 bags up to 23kg each

Virgin Australia Velocity program (economy class)

  • No membership or Red membership: 1 bag up to 23kg
  • Silver or Gold membership: 2 bags up to 23kg each
  • Platinum membership: 3 bags up to 23kg each

Consider the new costs if our traveller has a membership with one of these programs that allows for an extra luggage item and they’re travelling with:

  • One carry-on bag weighing 5kg
  • One piece of checked luggage weighing 21kg
  • One set of golf clubs weighing 20kg
Ticket costChecked luggageOversized item (golf clubs)In-flight mealSeat selectionTotal cost
Jetstar$89$25$25$6$6$151
Tigerair$89$25$35$10.50$5$164.50
Virgin Australia$165IncludedIncludedIncludedIncluded$165
Qantas$184IncludedIncludedIncludedIncluded$184

Now the prices for the budget and the all-inclusive carriers have become very similar and if our traveller had heavier items or even more luggage, then it could become significantly cheaper to fly with Qantas or Virgin Australia than it would be to fly with Jetstar or Tigerair.


Other fees and charges

The cheapest flight might turn into the most expensive one if you run into too many fees. There are charges for changing your booking, cancellations, certain payment methods and more.

If you’re travelling with an infant then the flat $30 fee from Tigerair can make a difference, especially next to Virgin Australia’s free infant travel for domestic flights. Or, if you’re paying with card for multiple tickets or a big fare, then card fees are also worth considering.

The following information applies to domestic flights.

JetstarTigerairVirgin AustraliaQantas
Card payment feesCredit card: 1.06%Debit card: 0.48%Mastercard credit: 1.25%Mastercard debit: 0.86%Visa credit: 1.33%Visa debit: 0.88%Credit card: 1.3%Debit card: 0.6%Credit card: 1.3%Debit card: 0.6%
Infant feeA percentage of the adult fare$30None10% of the adult fare
Booking fee$32-$35 depending on the booking methodOnline booking only$40$40
Customer contact centre feeNone$35$40None
Flight change fee$55 (online)$85 (over the phone)$80, plus any applicable fare difference$80, plus any applicable fare difference$10-$40

If you’re booking return flights, then prices change once again and fees are magnified for every extra flight you take.


How do return flights affect prices?

Assuming our traveller doesn’t want to stay in Adelaide forever, he or she has probably booked a return flight. The extra charges for baggage, meals and seat selection usually apply per flight, so the effect these have on the total cost is generally magnified with a return flight.

This table shows the total cost if the traveller books a return flight for the next day, Sunday 2 July.

Outbound flight costReturn flight costChecked luggageSeat selection (standard only)In-flight meal or snackEligible for frequent flyers?Total
Jetstar (economy starter)$89$109$36$12$12No$258
Jetstar (Plus)$124$144IncludedIncludedIncludedYes$268
Tigerair (Light)$89$89$36$10$21Yes$245
Tigerair (Express)$103$103$36Included$21Yes$263
Virgin Australia (Getaway)$165$125IncludedIncludedIncludedYes$290
Qantas (Red eDeal)$184$166IncludedIncludedIncludedYes$350

If you’re flying with multiple pieces of luggage, then flying with an all-inclusive carrier offers greater and greater value the more flights you take. Additional luggage limits from your frequent flyer status mean it’s likely to be cheapest to fly with a full-service airline.

This table shows the cost of flying if our traveller has a membership with a frequent flyer program that allows for an extra luggage item and they’re travelling on a return flight with:

  • One carry-on bag weighing 5kg
  • One piece of checked luggage weighing 21kg
  • One set of golf clubs weighing 20kg
Cost of a return ticket (two one-way tickets)Checked luggageOversized item (golf clubs)In-flight mealSeat selectionTotal cost
Jetstar$198$50$50$12$12$322
Tigerair$178$50$70$21$10$329
Virgin Australia$290IncludedIncludedIncludedIncluded$290
Qantas$350IncludedIncludedIncludedIncluded$350

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Andrew Munro

Andrew writes for finder.com, comparing products, writing guides and looking for new ways to help people make smart decisions. He's a fan of insurance, business news and cryptocurrency.

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