In his report to the 80th IATA Annual General Meeting, Willie Walsh, the Director General of the International Air Transport Association (IATA), painted a largely positive picture of the air transport industry’s performance in 2024.
Financial Performance
According to Walsh, the industry is on track to generate record revenues of almost $1 trillion this year. However, expenses will also reach a new high of $936 billion, resulting in a net profit of $30.5 billion. While this profit figure does not represent a new record, it reflects a major achievement considering the industry’s struggles just a few years ago, said Walsh.
He noted that air travel remains good value for money, with 77% of 6,500 travelers polled across 15 markets agreeing with that assessment. This is not surprising given that the real cost of air travel has fallen 34% over the past decade.
However, Walsh cautioned that airlines’ profit margins remain wafer-thin, with the industry expected to earn a 5.7% return on invested capital this year, well below the average 9% cost of capital. He urged governments to understand the industry’s financial constraints before seeking new tax revenues.
Safety
On the safety front, Walsh reported that 2023 was the industry’s safest year yet, with no fatal accidents among IATA’s 336 member airlines or the 433 IOSA-registered carriers globally. He credited the IATA Operational Safety Audit (IOSA) program, which has become a cornerstone of global safety standards, and the IATA Global Aviation Data Management initiative, which captures data from 150,000 flights weekly.
Looking Ahead
Despite the positive results, Walsh said the industry must continue to promote global standards, modernize business practices, and build a more sustainable future. He expressed concern over the Netherlands’ plan to permanently cut Schiphol Airport’s capacity by at least 40,000 flights annually, which he said would be a blow to global connectivity standards.
Overall, Walsh’s report painted a picture of an industry that has made significant strides in recent years, but still faces challenges in maintaining profitability and navigating the complex regulatory landscape.
