News
International Air Transport Association Global Media Day December 10, 2024
December 11th 2024
News from the International Air Transport Association (IATA) Global Media Days being held in Geneva this week includes the airline lobby group's new financial forecasts and updates on supply chain issues and Sustainable Aviation Fuel production. Read More »
IATA forecasts airline profits will improve in 2025
The International Air Transport Association (IATA) expects airline profits to increase next year as a result of forecast lower oil prices, high load factors and a return to more normal market expansion following a post-pandemic capacity ramp up. The airline lobby group predicts the industry will book a US$36.6 billion net profit in 2025. For full-year 2024, the association forecasts collective airline profits will be US$30.5 billion. “In 2025, for the first time, traveler numbers will exceed five billion and flights will reach 40 million,” IATA director-general, Willie Walsh, said. "Asia-Pacific airlines are forecast to achieve net profits of US$3.6 billion in 2025 up from US$3.2 billion this year, IATA said.
Supply chain problems to persist well into next year
IATA reports the severe supply chain issues plaguing airline performance will continue into 2025. "Supply chain issues are frustrating every airline with a triple whammy impact on revenues, costs and environmental performance," Walsh said. “Load factors are at record highs and there is no doubt that if we had more aircraft they could be profitably deployed, so our revenues are being compromised.” IATA noted aircraft deliveries had fallen from a peak of 1,813 in 2018 to 1,254 this year. The current estimate for 2025 deliveries is 1,802 aircraft. IATA highlighted these numbers are well below previous estimates for next year of 2,293 aircraft deliveries. More downward revisions are possible, IATA said. “This is a time when airlines need to be fixing their battered post-pandemic balance sheets, but progress is effectively being capped by supply chain issues that manufacturers need to resolve,” Walsh said.
Sustainable Aviation Fuel production continues at snail’s pace
Sustainable Aviation fuel (SAF) output reached 1 million tonnes this year, or 0.3% of global jet fuel production. It will be double 2023 output of 500,000 tonnes but be well below projections of 1.5 million tonnes of SAF for the current year. IATA said SAF facilities in the U.S. have delayed their production ramp up to first-half 2025 and that SAF production is now forecast to reach 2.1 million tonnes, or 0.7% of total jet fuel production in 2025. “SAF volumes are increasing, but disappointingly slowly," Walsh said. "Governments must quickly deliver concrete policy incentives to rapidly accelerate renewable energy production.”
