Jake Hardiman from Simple Flying – Reports

The International Air Transport Association (IATA) predicts that the airline industry will see record revenues in 2024.

• The industry’s resilience and people’s love for travel have contributed to a strong recovery, resulting in a projected net profit of $25.7 billion in 2024.
• IATA expects more passengers than ever before in 2024, with a prediction of 4.7 billion travellers taking to the skies.
• The International Air Transport Association (IATA) has announced its projections for the worldwide airline industry in 2024. The group also shared its profitability predictions for this year, and it noted that 2024 will see the industry’s revenues reach record levels. The sector’s profit margins are also set to see slight growth.

The key figures
As IATA revealed to the world earlier this morning, it expects the airline industry’s operating profits to total $40.7 billion this year, with this figure climbing to $49.3 billion in 2024. When all is said and done, this will amount to net profits of $23.3 billion for the industry in 2023, with the total growing to an impressive $25.7 billion next year. Commenting on the figures, IATA Director General Willie Walsh stated:

“Considering the major losses of recent years, the $25.7 billion net profit expected in 2024 is a tribute to aviation’s resilience. People love to travel and that has helped airlines to come roaring back to pre-pandemic levels of connectivity.”

Walsh added that while “the speed of the recovery has been extraordinary, it also appears that the pandemic has cost aviation about four years of growth.” With more normal growth patterns expected next year, the industry profit margin is set to rise marginally from 2.6% to 2.7%. A key contributing factor is a projected revenue total of $964 billion, which would represent a 7.6% year-on-year increase.

More passengers than ever before
Away from the financial side of things (although it certainly contributes to the strong projections), IATA also expects more travelers to take to the skies than ever before in 2024. All in all, the group’s prediction currently sits at 4.7 billion, compared to the pre-pandemic high of 4.5 billion achieved in 2019. According to a corresponding IATA presentation, profit-per-passenger will be $5.45 next year (vs $5.44 in 2023).

In terms of passenger traffic, IATA notes an interesting contrast between the recoveries of the domestic and international markets. Indeed, according to the group, worldwide domestic revenue passenger kilometers have been exceeding pre-pandemic levels since April this year. However, owing to international RPKs being 5.6% lower, overall traffic remains 2-2.5% down on pre-COVID times.

That being said, IATA’s outlook for 2024 on this front remains strong, with a projected increase of 9.8% when it comes to revenue passenger kilometers. On this front, the association adds that “while that is more than double the pre-pandemic growth trend, 2024 is expected to mark the end of the dramatic year-on-year increases that have been characteristic of the recovery in 2021-2023.”

Load factors are also closing in
The industry is also breathing down the neck of the figures that it achieved in 2019 when it comes to load factor. Indeed, the third quarter of 2023 saw an average of 84.2%, just 0.3% lower than the 84.5% recorded in the last full year before the onset of the coronavirus pandemic. Some regions’ load factors have already exceeded 2019’s levels, such as Africa, Latin America, and the Middle East.