Profitability in Aviation Sector to Strengthen in 2025, But Supply Chain Issues Persist
The International Air Transport Association (IATA) unveiled its financial outlook for the airline industry in 2025 during the Global Media Day. According to the report, despite ongoing cost and supply chain challenges, profitability is expected to improve:
• Net Profit: Expected to reach $36.6 billion in 2025 with a net profit margin of 3.6%. This represents an increase from the $31.5 billion expected in 2024 (3.3% margin). Net profit per passenger is projected at $7.
• Operating Profit: Forecasted at $67.5 billion in 2025, with a net operating margin of 6.7%.
• Revenues and Expenses: Total industry revenues are expected to grow by 4.4% to $1.007 trillion, while expenses are projected to rise by 4% to $940 billion.
• Passengers and Cargo: Passenger numbers are expected to grow by 6.7% to 5.2 billion, and cargo volumes by 5.8% to 72.5 million tons.
IATA Director General Willie Walsh attributed the industry’s growing profitability to declining oil prices, high load factors, and strict cost control. However, Walsh emphasized that infrastructure deficiencies and supply chain challenges remain significant hurdles for the sector.
Walsh particularly highlighted the fragmented air traffic control systems in Europe as barriers to capacity growth and environmental performance improvements. “While significant investments are being made in airport infrastructure across the Asia-Pacific region, progress in Europe remains sluggish. This limits the growth potential of global aviation,” Walsh said. He also underscored the impact of supply chain disruptions, particularly delays in aircraft and engine deliveries.
Walsh also addressed the importance of gender diversity goals, emphasizing the need for greater representation of women in the aviation sector. “The 25 by 2025 target aims to accelerate this transformation,” he said.
Marie Owens Thomsen, IATA’s Senior Vice President for Sustainability and Chief Economist, highlighted the strategic importance of aviation to the global economy, noting that for the first time, industry revenues are expected to surpass $1 trillion. However, she also cautioned that a net profit margin of 3.6% provides only a limited buffer for the industry.
