IATA forecasts positive outlook for global airline industry in 2025

Geneva (The Uttam Hindu): The global airline industry in 2025 expects a slight increase in profitability amid ongoing cost and supply chain challenges, the International Air Transport Association (IATA) said on Tuesday, highlighting some positives such as lower oil prices and growing connectivity. Net profits are expected to be 36.6 billion dollars in 2025 for a 3.6 per cent net profit margin, a slight improvement from the expected 31.5 billion net profit (3.3 per cent net profit margin) in 2024, the IATA said in a statement. The average net profit per passenger is expected to be 7.0 dollars in 2025, up from 6.4 dollars in 2024, the IATA noted, adding that the airline industry's operating profits are expected to reach 67.5 billion dollars in 2025, for a net operating margin of 6.7 percent, the IATA said. Total industry revenues are expected to be 1.007 trillion dollars, up by 4.4 per cent from 2024, with expenses expected to grow by 4.0 percent to 940 billion dollars. The IATA said it will be the first time that industry revenues top the 1-trillion-dollar mark, Xinhua news agency reported.

According to the statement, passenger numbers are expected to reach 5.2 billion in 2025, a 6.7 per cent rise compared to 2024, marking the first time the volume exceeds the five billion threshold. Meanwhile, cargo volumes are expected to reach 72.5 million tonnes, a 5.8 per cent increase from 2024. Referring to several drags on the industry's profitability, namely persistent supply chain challenges, infrastructure deficiencies, onerous regulation, and a rising tax burden, IATA Director General Willie Walsh pointed out several positive factors that help to mitigate the challenges, including lower oil prices, tightly controlling costs, investing in decarbonization, and post-pandemic economic recovery. IATA also highlighted the broad benefits of growing connectivity. The latest estimates show that airline employment will expand to 3.3 million in 2025. Airlines are the core of a global aviation value chain that employs 86.5 million people and generates 4.1 trillion dollars in economic impact. "Looking at 2025, for the first time, traveler numbers will exceed five billion and the number of flights will reach 40 million. This growth means that aviation connectivity will be creating and supporting jobs across the global economy," said Walsh.