AVIATION INDUSTRY UPDATE: JUNE 2, 2025The global airline industry is showing signs of resilience despite economic headwinds, with the International Air Transport Association (IATA) projecting profits of $36 billion for 2025, an increase from $32.4 billion recorded in 2024[1]. This forecast was announced today at IATA's Annual General Meeting in India, its first such gathering in the country in 42 years.Industry revenues are expected to reach a historic high of $979 billion in 2025, representing a 1.3% increase over last year[1]. This revenue growth is outpacing the projected 1.0% increase in expenses, helping to shore up profitability[2].IATA Director General Willie Walsh highlighted the industry's ability to weather challenges, noting that net profit margins are improving from 3.4% in 2024 to 3.7% in 2025[2]. However, this remains about half the average profitability across all industries.A key positive driver has been the 13% reduction in jet fuel prices compared to 2024[2]. The industry also anticipates increased passenger and cargo volumes, though previous demand projections have been affected by trade tensions and declining consumer confidence.Supply chain issues continue to plague the aviation sector, with a backlog of 17,000 aircraft and approximately 1,100 planes under 10 years old sitting in storage[1]. The fleet replacement rate stands at just three percent.Walsh emphasized the thin profit margins, pointing out that the projected $36 billion profit equates to just $7.20 per passenger per segment[2]. He cautioned that any new taxes, increased charges, demand shocks, or costly regulations could quickly challenge the industry's resilience.As the aviation industry continues to serve as the core of a value chain supporting 86.5 million jobs and 3.9% of global economic activity, industry leaders are calling for policymakers to consider these realities when developing regulations and policies affecting the sector[2].This content was created in partnership and with the help of Artificial Intelligence AI

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