IATA Foresees Sustainable Increase in Profits And Traveler Numbers in 2024

Industry group IATA has predicted that airline profits will stabilize in 2024, with continued growth in post-pandemic travel offset by the high cost of capital and capacity constraints. Despite planes being grounded and travelers reluctant to fly during the COVID-19 pandemic, the global airline sector has largely recovered, with demand booming across North America, the Middle East, and Europe. 


According to IATA, the airline sector returned to profitability in 2023, with net profit expected to be $23.3 billion on a 2.6% margin, and is set to reach $25.7 billion and a margin of 2.7% next year. However, while revenues are expected to reach a record $964 billion, the high cost of capital driven by rising interest rates is a concern, the global body said. 

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IATA's head, Willie Walsh, said "Industry profits must be put into proper perspective. On average, airlines will retain just $5.45 for every passenger carried, which is about enough to buy a basic grande latte at a London Starbucks." Despite this, the number of global travelers is expected to climb to historic levels, with 4.7 billion people expected to travel in 2024 compared with 4.5 billion in 2019. 

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Additionally, many countries that lagged in the travel recovery, such as China where international travel is still 40% below pre-pandemic levels, are set to turn a profit again in 2024. The industry body warned that global instability, including the Israel-Hamas war and the Ukraine war, could negatively impact the sector, especially as they continue to drive up oil prices. Jet fuel prices are expected to account for 31% of all airline operating costs.

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