On Tuesday, the International Air Transport Association released a forecast of the global air industry’s 2025 revenue to be in the trillion dollar range and record high passenger numbers, despite huge difficulty in securing new planes, according to IATA chief Willie Walsh.
The manufacturing problem at Boeing and Airbus and their supplier has delayed jet delivery to many airlines around the world, curtailing their growth as the airlines could not cut back their fuel cost and increase seats.
Walsh was calling out suppliers for being “quasi-monopoly”, benefiting from the problem that the delay caused. Many critics also said that the delay has pushed the price of spare parts up, increasing operating costs for the airline while suppliers profited from high demand.
In July, Airbus, the world’s biggest plane manufacturer, cut its delivery target down, while Boeing slowed its production due to a strike and safety concerns from the regulatory body. Producers of jet engines also saw a major setback.
Meanwhile, IATA is expecting the airline industry to strike gold next year, with revenue going up to $1 trillion in 2025 from this year’s projected $964 billion. The forecast is anticipating an industry-wide net profit of $36.6 billion from this year’s expected $31.5 billion, with a predicted 5.2 billion passengers.
The projection came after the industry hit rock bottom during the pandemic when the industry witnessed a $140 billion loss in 2020 from travel restrictions.
Thus, the post-pandemic recovery is largely attributed to a rebound in travel demand for increased flight, although environmentalist groups have criticized the rampening of flight as harming the environment from emissions.
Donald Trump’s rolling back some of the Biden-era policy and pro-business attitude is also relieving some of the worries from the airline, as well as Trump-supporting U.S. oil production bringing jet fuel prices down.
Meanwhile, some economists say that Trump’s tariff policy and possible trade war could diminish trade and business, and could affect airlines as well.
