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Mohamed Ben Abderrazek
| December 15, 2024 at 10:09 p.m.
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Airlines expect to carry a record 5.2 billion passengers in 2025 and see their profitability improve thanks to a decline in oil prices, their main global organization announced this week.
The global turnover of air carriers is expected to grow by 4.4% year-on-year and exceed $1,000 billion for the first time next year, estimates the International Air Transport Association (IATA), which also forecasts that 5.2 billion people will take to the skies next year.
Supply Chain Challenges
The association, which has some 340 member companies representing 80% of global air traffic, warned that this growth would remain constrained by “problems with supply chains, deficient infrastructure (…) and an increase in tax pressure”. But 2025 promises to be “a good year”, according to the organization: it will be “the first time that the number of passengers exceeds five billion”, after the 4.96 forecast in 2024 which should already make it possible to erase the record of 4.54 billion set in 2019, before the global health crisis.
In addition, the airlines are expected to post a cumulative net profit of $36.6 billion, up 16.1% from expected profits in 2024, and synonymous with a net margin of 3.6%.
Favorable profitability forecasts
The turnover of carriers should reach 1,007 billion dollars, an increase of 4.4% over one year, while costs will only increase by 4%, to 940 billion. So many figures which “deserve to pop a champagne cork”, launched the chief economist of IATA, Marie Owens Thomsen, welcoming the spectacular turnaround of a sector which had sunk into abysmal losses for the pandemic, estimated by IATA at $183 billion cumulatively between 2020 and 2022.
After suffering from high oil prices since Russia’s invasion of Ukraine in February 2022, airlines hope to take advantage of their downturn next year to reduce their bills. In 2025, a barrel of kerosene should cost on average $87, after $99 in 2024.
As a result, fuel will only represent 26.4% of airline operating costs, compared to 28.9% in 2024, IATA predicts. In absolute value, companies’ spending on fuel will amount to “248 billion dollars, a fall of 4.8% over one year despite an increase in consumption forecast up 6%” to 405 billion liters, according to the association.
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