IATA: airlines to achieve profits of more than 23 million dollars

Airlines will achieve total net profits of $23.3 billion in 2023, the first since the pandemic began in 2020, and these will increase in 2024 to $25.7 billion, according to a forecast released by the International Air Transport Association (IATA).

The air transport sector, one of the hardest hit during the pandemic by movement restrictions ordered almost everywhere in the world, lost $137.7 billion in 2020, $41 billion in 2021 and still $3.8 billion in 2022.

Revenues this year will total $896 billion, a year-on-year increase of 21.7% and higher for the first time than in 2019 ($838 billion), according to statistics released by the leading global airline association at its annual press session, held at Geneva Airport.

In 2024 revenues will climb another 7.6% to $964 billion.

In 2023, $642 billion of that revenue will come from passenger transport and $134.7 billion from cargo, while in 2024 the figures will be $717 billion and $111.4 billion, respectively.

Costs this year will be $855 billion, up 18.1% from 2022, and will rise to $914 billion in 2024, up 6.9% year-on-year.

“Considering the huge losses of recent years, the net profit of $25.7 billion expected in 2024 is a reward for aviation’s resilience,” appraised IATA director general Willie Walsh.

“People love to travel and this has helped airlines return to pre-pandemic levels of connectivity with extraordinary speed but it has cost the industry four years of growth,” he said.

IATA projects that some 4.7 billion people will travel by air in 2024, an all-time high that would surpass the last pre-pandemic year, 2019 (4.5 billion).

Walsh stressed that current growth margins (of 2.7% in 2024) are still below investors’ expectations.

“On average, airlines make $5.45 per passenger, enough to buy a coffee at the Starbucks at London airport but insufficient to build a resilient future to the problems that may face an industry on which 3.5% of global GDP depends,” he said.

The sector expects declining inflationary tensions to benefit its finances, as well as low global unemployment rates and strong demand, although it notes that there are risks that could affect its 2024 figures, such as the potential slowdown of the economy in China, with high levels of youth unemployment and pressures on its powerful real estate sector.

As for the current conflicts, such as the one in Ukraine or the war between Israel and Hamas, IATA says that their adverse effects on the sector have been limited thanks to the modification of routes passing through the affected airspaces.

On the other hand, they have led to fuel price increases that have had an effect on rising costs for airlines.

“An uneasy peace in these conflicts could bring benefits to the industry, but on the other hand an escalation could produce a radically different global scenario to which aviation would not be immune,” the annual report states.

Source: Arecoa.com

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