Dubai
International Air Transport Association (IATA), has strengthened its profit outlook, for global airlines for 2024 on the back of record increase in passengers, and revenue.
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IATA which represents 330 airlines globally, expects airlines to post $30.5 billion net profit with nearly $1 trillion in revenue in 2024, it announced on Monday.
Previously IATA had forecasted $25.7 billion net profit for global airlines in 2024, and its latest revision indicates strong recovery for air travel from pandemic years.
Revenue and profit estimate has been pegged higher even as airlines continue to face aircraft delivery delays and supply chain challenges.
"In a world of many and growing uncertainties, airlines continue to shore-up their profitability. The expected aggregate net profit of $30.5 billion in 2024 is a great achievement, considering the recent deep pandemic losses. With a record five billion air travellers expected in 2024, the human need to fly, has never been stronger," IATA's director general, Willie Walsh said at the airline body's 80th annual general meeting in Dubai.
Profitability is expected to strengthen in 2024, as revenues grow slightly faster than expenses (9.7 per cent vs. 9.4 per cent respectively), he added. While North American carriers will significant contributors to industry profitability, Asia Pacific region will contribute to passenger growth, with demand recoveries in China, Japan and other countries.
Walsh however cautioned that supply chain challenges continue to persist, and the industry continues to face challenges like onerous regulations and taxes.
"The best thing that I can say about the supply chain exasperations of the last years, is that they appear to have not gotten worse. On top of that sits onerous regulation. So, there is still plenty standing in the way of sustainable industry-level profits. But we can do it, " Walsh remarked.
Indian government needs to open up for foreign carriers
Later responding to a media query, Walsh said potential of Indian aviation can be further unlocked with right government policies.
Walsh said, “If India has to fulfill the ambitions of its airline industry, and enable them to become global carriers, it needs to open access. That is the way it works in airline industry,” he said.
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Walsh said he is hugely optimistic about India. " I look at India and am amazed by its potential. Back in 2000, the Indian domestic market, represented 0.4 per cent of global aviation, and last year, it became 1.8 per cent. It is growing at a fast pace. Potential exists, and can be unlocked with right government policies," he added.
(The writer is in Dubai at the invitation of IATA)