The International Air Transport Association (IATA) predicts the global airline industry to generate a net profit of $9.8 billion in 2023.
IATA 79th Annual General Assembly and World Air Transport Summit continue in Istanbul.
Within the scope of the event, IATA's 2023 projections were also shared.
Making statements regarding the expectations, IATA Director General Willie Walsh said that the net profit of the airline industry is expected to reach $9.8 billion in 2023, more than double the previous estimate of $4.7 billion.
Stating that the operating profit of the sector is expected to reach 22.4 billion dollars in 2023, Walsh continued his words as follows:
“Approximately 4.35 billion people are expected to travel in 2023, approaching 4.54 billion people traveling by plane in 2019. Cargo volume is expected to be 57.8 million tons this year, which fell below the 61.5 million tons transported in 2019 with the sharp slowdown in international trade volume.
Total revenues are expected to reach $803 billion, an increase of 9.7 percent compared to the previous year. Industry revenues are forecast to exceed the $800 billion mark for the first time since 2019 ($838 billion). The increase in expenses is expected to be limited to 8.1 percent annually.
"The sector's return to net profitability is a great success"
Regarding the growth outlook of the aviation industry, Willie Walsh said, "Airlines' financial performance exceeds expectations this year. Stronger profitability is supported by several positive developments. China lifted the Kovid-19 restrictions earlier than expected during the year. Although volumes do not increase, cargo revenues are above pre-pandemic levels. On the cost side, there is some relief. Jet fuel prices remained moderate in the first half of the year, although still high."
Noting that the sector's return to net profitability is seen as a great success, even with a net profit margin of 1.2 percent, Walsh said, "First of all, the sector's operating with profitability in a period of economic uncertainties seems to be an important success. Second, the increase in net profit came after the biggest loss of $183.3 billion in aviation history in the 2020-2022 period. It should be noted that the airline industry entered the Covid-19 crisis at the end of a historic profit streak with an average net profit margin of 4.2 percent for the 2015-2019 period.”
Commenting on the profitability of airlines, Walsh concluded his words as follows:
“Economic uncertainties have not dampened the desire to travel, even as ticket prices absorb rising fuel costs. Even the 1.2 percent net profit margin is a welcome development after deep Covid-19 losses. But in an environment where airlines earn an average of $2.25 per passenger, it will continue to be difficult for many airlines to repair damaged balance sheets and provide sustainable return on capital to investors."