midst growing uncertainties and high airfares, global airlines are expected to achieve a net profit of $30.5 billion and a record five billion air travellers in 2024, according to Willie Walsh, IATA’s Director General.
Speaking at IATA’s 80th Annual Assembly in Dubai, Walsh stated, “The airline industry is on the path to sustainable profits, but there is still a big gap to cover. A 5.7% return on invested capital is well below the cost of capital, which is over 9%. Earning just $6.14 per passenger indicates how thin our profits are—barely enough for a coffee in many parts of the world.”
Passenger revenues are projected to reach $744 billion in 2024, up 15.2% from $646 billion in 2023. Revenue passenger kilometers (RPKs) are expected to grow by 11.6% year-on-year, with a long-term growth trend of 3.8% annually from 2023 to 2043.
However, cargo revenues are anticipated to fall to $120 billion in 2024 from $138 billion in 2023. While this represents a decline from the peak of $210 billion in 2021, it is still above the 2019 revenue figure of $101 billion and an improvement from the previous forecast of $111 billion announced in December 2023.
Fuel costs are expected to average $113.8 per barrel of jet fuel in 2024, leading to a total fuel bill of $291 billion, which will account for 31% of all operating costs. High crude oil prices, coupled with a 30% crack spread (premium paid to refine crude oil into jet fuel), are anticipated to persist, exacerbating fuel expenses for airlines.
