IATAThe International Air Transport Association (IATA), which is holding its annual general meeting in Dubai, has revised upwards its profitability and traffic estimates for airlines in 2024. In his presentation speech, IATA Director General Willie Walsh analysed the situation as follows: " In a world of many and growing uncertainties, airlines continue to consolidate their profitability. The expected overall net profit of 30.5 billion dollars in 2024 is a great success after the losses linked to the pandemic. With a record five billion air travellers expected in 2024, the desire to fly has never been stronger" . And he adds, for the benefit of air transport's detractors: " There is no doubt that aviation is essential to the ambitions and prosperity of individuals and economies. It is therefore important to strengthen the profitability of airlines and increase their financial resilience. This profitability makes it possible to invest in products that meet the needs of our customers and their businesses. in sustainability solutions that we will need to achieve zero net carbon emissions by 2050" .
The average passenger load factor is expected to be 82.5 % in 2024. However, profits per passenger remain low. According to Willie Walsh, it averages just $6.14 and supply chain issues will need to be addressed in order to deploy fleets efficiently to meet demand. Supply chain disruptions with increasing aircraft delivery problems and recent technology failures are becoming a major issue for the airline industry. the main factor holding back even stronger growth. Willie Walsh also blames onerous regulations and taxes that penalise air transport. A litany that IATA has been repeating over and over for decades...
More passengers, more revenue
However, according to the association, financial and traffic results should be better than estimated at the end of last year. The operating profits should reach $59.9 billion (+14.7 % compared with the estimated $52.2 billion for 2023). Net profits, on the other hand, are expected to grow slightly more slowly (+11.3 %), rising from an estimated $27.4 billion in 2023 to an estimated $30.5 billion in 2024.
Passenger revenues are expected to reach $744 billion in 2024, an increase of 15.2 % compared with 2023. Growth in revenue passenger kilometres (RPK) is expected to be +11.6 % year-on-year. The long-term growth trend over 20 years should see passenger demand increase by 3.8 % per year for the period 2023-2043. 2024 should therefore break an all-time record with 4.6 billion air travellers worldwide.
In Europe, IATA estimates that airline net profits will reach $9 billion, compared with $8.6 billion in 2023. Demand should increase by 11.1% and available capacity by 11.5%. More surprising is the trend in fares according to IATA. While the perception of travellers is that air fares are set to rise ever more sharply, IATA talks about reduction in the average real price of a return ticket.
Cheap air travel according to IATA
According to the association, measured in constant 2018 dollars, the real average price of a return air ticket in 2024 should be 252, compared with $306 in 2019. It confirms the steady decline in the price of travel, even if the figures are somewhat distorted by the shorter travel distances in 2024. However, the fares revealed by IATA do not include taxes and other surcharges.
According to data from IATA's April 2024 survey, 77 % of those questioned believe that air travel represents good value for money. The same survey shows that 39 % of those questioned plan to travel more in the next 12 months than in the previous 12 months. 54 % say they expect to travel as much as in the previous 12 months. Only 6 % expect to travel less.
Some 46% of those surveyed expect to spend more on travel in the next 12 months than in the previous 12 months. An almost equal proportion (45%) expect to spend the same on travel over the next 12 months, while 9% expect to spend less. This result somewhat contradicts IATA's claims of an average price decrease.
