World airlines will likely crack the $1 trillion mark in revenues next year, IATA says.
The International Air Transport Association updated its financial outlook for the global airline industry on 10DEC and projects a significant increase in profits by 2025. Total industry revenues are expected to be $1.007 trillion, an increase of 4.4% from 2024.
That will mark the first time that industry revenues top $1 trillion.
Despite ongoing supply chain problems with Airbus and Boeing, IATA said global passenger numbers are expected to reach an all-time high of 5.2 billion next year. That’s up 6.7% from 2024.
Bloomberg reports the global airline industry is forecast to rake in USD$36.6 billion in net income in 2025. That represents a 16% gain on 2024 figures.
IATA also predicted that airlines’ average profit per passenger would increase to around $7 next year, up sharply from just $2.25 18 months ago. This year, per-passenger profit is expected to be $6.40.
“The figures represent a stunning comeback for an industry that, because of the pandemic, recorded three consecutive years of losses between 2020 and 2022, amounting to almost $187 billion,” CNN reports.
IATA director general Willie Walsh said surpassing $1 trillion in revenue is great news, but that net profitability in the industry would still be “wafer-thin,” at $36.6 billion.
“This will be hard-earned as airlines take advantage of lower oil prices while keeping load factors above 83%, tightly controlling costs, investing in decarbonization, and managing the return to more normal growth levels following the extraordinary pandemic recovery. All these efforts will help to mitigate several drags on profitability which are outside of airlines’ control, namely persistent supply chain challenges, infrastructure deficiencies, onerous regulation, and a rising tax burden.”
Walsh said slow aircraft deliveries aren’t helping.
“Costs are being heavily impacted by the delays in getting new aircraft, keeping older aircraft in service,” he said in an interview on Bloomberg TV. “Although next year will be better financially, I think it would have been a lot better had we not faced all of these supply chain problems.”
