GENEVA (Reuters) — Global airlines body IATA forecast industry-wide 2025 revenue of more than a trillion dollars and record passenger numbers, despite what its chief Willie Walsh said on Tuesday were “unacceptable” difficulties in securing new planes.
Airlines around the world have seen their growth hampered by delays in jet deliveries stemming from problems at Boeing (BA.N), opens new tab and Airbus (AIR.PA), opens new tab as well as their suppliers.
Without newer, more efficient planes, airlines say they cannot cut back fuel costs while flying more people.
“We’ve given them time. I think our patience has run out. The situation is unacceptable,” International Air Transport Association director general Walsh told reporters in Geneva.
Walsh said suppliers were acting like “quasi-monopolies” and appeared to be benefiting from the problems they had caused. Critics say the delays have pushed up prices of spare parts, creating a windfall for suppliers at the expense of airlines.
“We’re going to have to ramp up the pressure and maybe look for support to force key suppliers to get their act together,” said Walsh, who was previously head of British Airways and its parent company IAG (ICAG.L), opens new tab.
Airbus, the world’s largest planemaker, cut delivery targets in July and Boeing has slowed production because of a strike and increased regulatory attention following a safety crisis.
Engine makers have also had a series of setbacks.
The aerospace industry says it is gradually returning to normal but has warned of supply pressures well into 2025.
It is not the first time that the airline industry has lashed out at its suppliers. In 2023, Walsh said airlines were “beyond frustrated” at shortages of new planes and spare parts.
In June last year, airlines asked IATA to hold talks with planemakers to seek a solution. Industry sources said that despite at least one such meeting, little tangible progress had been made, with many suppliers still reeling from the pandemic.
A passenger aircraft descends to land at Heathrow Airport in London, Britain, January 5, 2022. REUTERS/Toby Melville/File Photo Purchase Licensing Rights, opens new tab
Despite the problems, IATA said it expected the airline industry to hit a historic milestone with revenue of $1.007 trillion next year, up from a projected $964 billion this year.
It forecast industry-wide net profit of $36.6 billion in 2025, up from $31.5 billion expected in 2024, with a record 5.2 billion passengers set to fly.
That comes after the industry collapsed to a $140 billion loss in 2020 as a result of the pandemic.
Airlines have recovered thanks to a rebound in travel demand, but have drawn criticism from environmental groups for boosting profits by adding flights, harming the environment.
“If the amount of planes in the sky goes up, emissions will only keep going up more and more even if the planes are marginally more efficient,” Matt Finch, UK policy manager of advocacy group Transport and Environment, told Reuters earlier this year.
Jet fuel prices are also set to fall, offering some relief.
