Monday, June 3, 2024 The International Air Transport Association (IATA) has announced improved profitability projections for airlines in 2024 compared to its forecasts in June and December 2023. While the industry shows progress, an aggregate return above the cost of capital remains elusive. Key Highlights: Willie Walsh, IATA’s Director General, emphasized the resilience of airlines despite numerous uncertainties.
He noted that the projected net profit for 2024 is a significant achievement following the pandemic’s losses. Walsh also highlighted the critical role of aviation in facilitating global trade and connectivity, which underpins economic ambitions and prosperity. However, the industry faces challenges, including a return on invested capital that falls short of the cost of capital.
Walsh pointed out that resolving supply chain issues and receiving relief from stringent regulations and rising taxes are vital for improving profitability. He urged public policy measures that enhance business competitiveness, which would benefit the economy, job creation, and connectivity. IATA’s strengthened outlook for 2024 is driven by revenues growing faster than expenses.
Despite expected declines in cargo revenues from pandemic highs, passenger revenues are forecasted to increase significantly. The average passenger load factor and passenger yields are also expected to improve, reflecting strong demand and tight supply conditions. Overall, while the airline industry is on a path.
