Geneva (TIP) – The airline industry is projected to post a net profit of USD 25.7 billion and revenue at a historic high of USD 964 billion in 2024 as more normal growth is expected in both passenger and cargo segments, global grouping IATA said on Wednesday. For 2023, the net profit is estimated at USD 23.3 billion, significantly higher than the USD 9.8 billion projected by the International Air Transport Association (IATA) in June this year. Briefing reporters here, IATA Director General Willie Walsh said India is a “hugely exciting market” and that he was very optimistic. He was responding to a query related to India — one of the world’s fastest growing civil aviation markets. IATA is a grouping of more than 300 airlines.
It said industry revenues are expected to touch a historic high of USD 964 billion next year.
“An inventory of 40.1 million flights is expected to be available in 2024, exceeding the 2019 level of 38.9 million and up from the 36.8 million flights expected in 2023,” it noted.
The airline industry’s operating profit is expected to touch USD 49.3 billion in 2024 from USD 40.7 billion this year. “Some 4.7 billion people are expected to travel in 2024, a historic high that exceeds the pre-pandemic level of 4.5 billion recorded in 2019,” IATA said.
Industry passenger load factor is nearing its 2019 level, which is supporting the financial recovery of the airlines, IATA Director Policy and Economics Andrew Matters said.
“The airline industry net profit is expected to reach USD 25.7 billion in 2024 (2.7 per cent net profit margin). That will be a slight improvement over 2023, which is expected to show a USD 23.3 billion net profit (2.6 per cent net profit margin),” IATA said, while releasing its review of 2023 and the outlook for 2024 here. The industry is estimated to have a total fuel bill of USD 281 billion, accounting for 31 per cent of all operating costs, next year as the fuel price is expected to average USD 113.8 per barrel. “Airlines are expected to consume 99 billion gallons of fuel in 2024,” IATA said. Next year, the total expenses are estimated to rise to USD 914 billion. As per the grouping, high demand for travel coupled with limited capacity due to persistent supply chain issues continues to create supply and demand conditions supporting yield growth.”Passenger yields in 2024 are expected to improve by 1.8 per cent compared to 2023,” it added. The cargo volume is expected to be higher at 61 million tonnes next year compared to 58 million tonnes in 2023.
“From 2024, the outlook indicates that we can expect more normal growth patterns for both passenger and cargo… while the recovery is impressive, a net profit margin of 2.7 per cent is far below what investors in almost any other industry would accept,” Walsh said.
According to him, the airlines will always compete ferociously for their customers but they remain far too burdened by onerous regulation, fragmentation, high infrastructure costs, and a supply chain populated with oligopolies. About the Asia Pacific market, IATA said while some of the region’s main domestic markets — China, Australia and India — recovered quickly from the pandemic, international travel to/ from the region was subdued as China only eliminated the last of its international travel restrictions in mid-2023. The Asia Pacific region is expected to report a net loss of USD 0.1 billion in 2023 and have a net profit of USD 1.1 billion in 2024. Source: PTI
Airline industry to rake in $25.7 bn profit in 2024 India a hugely exciting market: IATA
