The International Air Transport Association (IATA) has forecast that airline profit will continue to grow in 2018, with the global industry’s net profit expected to rise to $38.4 billion – a significant improvement on the $34.5 billion expected for 2017.
Despite the rising costs for airlines, IATA has predicted that a strong demand, efficiency and reduced interest payments will make 2018 the fourth year in a row the airline industry has increased its net profit.
Though a rise in the total number of passengers is expected – jumping from 4.1 billion in 2017 to 4.3 billion – the growth in this rise has decreased. The rise in expected passengers from 2017 represents a growth of six per cent, whereas in the number of passengers in 2017 enjoyed a 7.5-per-cent increase on 2016’s numbers. The same is true with the growth of cargo; although the overall amount has increased, the percentage that it is expected to increase by (4.5) is far lower than last year’s growth (9.3)
Alexandre de Juniac, IATA’s director general and CEO, acknowledged that the airline industry was in a good place, with the ever-increasing number of flights and new routes meaning more passengers than ever were flying.
“The industry also faces longer-term challenges,” de Juniac acknowledged. “Many of them are in the hands of governments. Aviation is the business of freedom and a catalyst for growth and development. To continue to deliver on our full potential, governments need to raise their game—implementing global standards on security, finding a reasonable level of taxation, delivering smarter regulation and building the cost-efficient infrastructure to accommodate growing demand. The benefits of aviation are compelling—2.7 million direct jobs and critical support for 3.5 per cent of global economic activity. And the industry is ready to partner with governments to reinforce the foundations for global connectivity that are vital to modern life.”