Profitability projections for the world’s airlines have been upgraded with a record of almost five billion passengers expected to take to the air this year.
All regions are expected to generate profits for a second year in a row with the most significant increase being for Asia-Pacific carriers, according to Iata.
Overall net profits are expected to hit $30.5 billion in 2024, up from $27.4 billion last year and an improvement on the $25.7 billion forecast by the airline trade body last December.
Total annual revenues are projected to rise by 9.7% year-on-year to a record $996 billion as passenger number are expected to reach 4.96 billion.
The figures released at Iata’s annual meeting in Dubai came as a consumer poll by the association found that 86% said that business travel was an easy investment too justify, 77% agreed that air travel was good value for money and 90% said flying was a necessity for modern life.
About 39% of respondents expect to travel more over the next 12 months than they did in the previous year.
The majority (54%) expect to travel as much as they did in the previous 12 months. Only 6% reported that they expect to travel less.
Almost half (46%) expect to spend more on travel over the next 12 months than they did in the previous 12 months.
An almost equal proportion (45%) expect to spend the same on travel over the next 12 months while 9% expect to spend less.
Iata director general Willie Walsh said: “In a world of many and growing uncertainties, airlines continue to shore-up their profitability.
“The expected aggregate net profit of $30.5 billion in 2024 is a great achievement considering the recent deep pandemic losses.
“With a record five billion air travellers expected in 2024, the human need to fly has never been stronger.
“Moreover, the global economy counts on air cargo to deliver the $8.3 trillion of trade that gets to customers by air.
“Without a doubt, aviation is vital to the ambitions and prosperity of individuals and economies.
“Strengthening airline profitability and growing financial resilience is important. Profitability enables investments in products to meet the needs of our customers and in the sustainability solutions we will need to achieve net zero carbon emissions by 2050.”
He added: “The airline industry is on the path to sustainable profits, but there is a big gap still to cover. A 5.7% return on invested capital is well below the cost of capital, which is over 9%.
“And earning just $6.14 per passenger is an indication of just how thin our profits are – barely enough for a coffee in many parts of the world.
“To improve profitability, resolving supply chain issues is of critical importance so we can deploy fleets efficiently to meet demand. And relief from the parade of onerous regulation and ever-increasing tax proposals would also help.
“An emphasis on public policy measures that drive business competitiveness would be a win for the economy, for jobs, and for connectivity. It would also place us in a strong position to accelerate investments in sustainability.”