Geneva (AFP) – Air passenger numbers are forecast to top five billion for the first time next year, and the sector’s revenues will break the trillion-dollar barrier, the global aviation body IATA said on Tuesday. “Passenger numbers are expected to reach 5.2 billion in 2025, a 6.7 percent rise compared to 2024 and the first time that the number of passengers has exceeded the five billion mark,” the International Air Transport Association said in a statement. Total industry revenues are meanwhile forecast at $1.007 trillion, helped by falling oil and fuel prices, “the first time that industry revenues top the $1 trillion mark,” it added. Revenues will be up 4.4 percent from 2024, it said. “All of this gives us a financial performance which I think is absolutely worth popping the champagne” for after a post-pandemic rebound, IATA chief economist Marie Owens Thomsen told a news conference in Geneva.
The aviation body’s Director General Willie Walsh said in the statement that IATA expected profits of $36.6 billion despite “persistent supply chain challenges, infrastructure deficiencies, onerous regulation, and a rising tax burden.”
Walsh voiced frustration, however, at delays to aircraft and engine suppliers, accusing them of failing to meet their commitments. IATA said that 1,254 aeroplanes were delivered to airlines in 2024 — 30 percent fewer than had been predicted — and noted a backlog of 17,000 undelivered planes. The delays were forcing airlines to run older, less efficient planes, it said. “Supply chain issues are frustrating every airline with a triple whammy on revenues, costs, and environmental performance,” Walsh said in a statement on the issue. “Manufacturers are letting down their airline customers, and that is having a direct impact of slowing down airlines’ efforts to limit their carbon emissions.”
Plane-maker Boeing saw its production hit this year during a nearly two-month strike by workers. Its rival Airbus in June lowered its production target for the year to 770 from 800, after problems with suppliers. IATA also said two percent of aircraft in the world — about 700 planes — were currently grounded for engine inspections.
Airlines have been hit by rising fuel costs since Russia invaded Ukraine in 2022, but IATA said it expected this factor to ease next year, with the cost of jet fuel averaging $87 a barrel, down from $99 in 2024. “Lower oil prices and resulting fuel costs are a major driver of improved prospects for airlines in 2025,” it stated. “Should these not materialise for any reason and considering the industry’s thin margins, the outlook could change significantly.”
IATA warned of “uncertainties” linked to the incoming administration of US president-elect Donald Trump. He has threatened heavy tariffs on some imports that could hit demand for air cargo, but is seen as business-friendly and has vowed to stimulate oil production. That would lower oil prices and “obviously help our industry in terms of limiting the evolution of our costs,” Owens Thomsen told AFP. IATA represents around 340 companies that account for 80 percent of world air traffic.
© 2024 AFP
