Easyjet and Gatwick Airport have agreed a seven-year growth and service improvement deal.
The aim is to “incentivise” the budget carrier to grow at the London airport.
The airline claims the certainty that the agreement provides will enable them to improve the passenger experience by deploying larger aircraft and increasing its number of slots.
It is replacing its 156-seat A319s with 180-seat A320s and, from 2017, A320 Neos.
Easyjet CEO Carolyn McCall said: “Gatwick is our largest base so it is of strategic importance to secure this new agreement.
“Easyjet shares the CAA’s view that Gatwick has market power but also supports the move towards a more commercial arrangement with the airport within a regulatory framework.
“This agreement gives Easyjet certainty on passenger charges over the next seven years and a clear incentive to continue to grow.
“More importantly, it will create a framework for Easyjet and Gatwick to plan and deliver an improved experience for our passengers.”
LGW CEO Stewart Wingate added: “This partnership with Easyjet is a landmark deal in London Gatwick’s history.
“Four years after the end of the BAA monopoly at the airport, this partnership highlights how far we have come to be able to operate within a new framework of commitments and contracts.
“For passengers travelling with Easyjet, they will have more choice, competitive fares and an even better experience. It is positive news for both business and leisure passengers travelling with Easyjet from Gatwick.”