EasyJet launches its package travel business as the airline appears to fill the gap in the industry that Thomas Cook's death led earlier this year.
About 20 million people fly with EasyJet to Europe annually, but only 500,000 book accommodation through it.
The news came when the carrier reported a 26% fall in pre-tax profits to £ 427m for the year to 30 September.
EasyJet also said that it would become the world's first large net zero carbon airline by offsetting carbon emissions.
CEO Johan Lundgren told BBC Radio 4 & # 39; s Today program: "This is not a long-term solution, set-off is not perfect.
" I do not think it is green washing, everyone is aware that it works, but this is in addition to the fact that since 2000 we have reduced our carbon emissions by 30%. "
He said the company would incur £ 25m costs and added:" There is nothing that adds to ticket prices, making us one of the largest carbon offsets in the world. "
& # 39; Non-traditional Holidays & # 39;
Explain the decision to restart package travel, EasyJet said in a statement:" The total European package travel market is worth around £ 61[ads1] billion a year. The UK alone is a £ 13bn market, growing 6% annually.
"The way customers take vacations is changing, and we know that customers want vacations of different durations and not the traditional seven and 14 nights.
" EasyJet is excited about the opportunity to build a major player in the holiday market for a low investment up front and at a limited risk. "
The airline said it had conducted research showing that customers wanted flexibility in flights and tailored vacations and it had designed its business to respond to this.
EasyJet's results showed that annual revenue increased 8.3% to £ 6.4bn as it increased capacity, but overall sales per seat fell 1.8% to £ 60.81 due to "some weakness in consumer confidence. "
The number of passengers increased 8.6% to 96.1 million.