Global airlines are expecting a strong recovery from the COVID-19 pandemic, as they more than double their industry profit forecast for 2023 to $9.8 billion from $4.7 billion on Monday.
The International Air Transport Association (IATA), which represents about 300 airlines worldwide, said that the sector would return to profitability next year after suffering huge losses in 2020 and 2021.
“The pandemic years are behind us and borders are open as normal”, IARA Director General Willie Walsh told the annual meeting of the association in Istanbul.
He said that the demand for air travel was robust, despite some challenges such as inflation, oil prices, and supply chain disruptions.
“Revenue levels for 2023 are also inching closer to pre-pandemic levels, climbing to an expected $803 billion versus $803 billion versus $838 billion in 2019”, he said.
He added that the industry’s profit margin of 1.2% was still too low and needed to improve to ensure long-term sustainability.
“A lot of people not just have to travel, but want to travel. And they will continue to do so through this year”, Walsh told Reuters in an interview separately.
He said that the high levels of employment and consumer confidence in many markets support the demand for air travel.
However, he also warned that some airlines could face difficulties in meeting the rising demand due to delays in getting new planes and staff.
“We have seen some airlines struggling to cope with the increase in demand…We have seen some airlines having to cancel flights because they don’t have sufficient crew”, he said.
He urged governments and regulators to support the industry by easing travel restrictions, providing financial relief and ensuring fair competition.
IATA also called for more action on climate change, saying that the industry was committed to reducing its carbon emission by 50% by 2050 compared to 2005 levels.
It said that it supported the use of sustainable aviation fuel, carbon offsetting, and market-based measures, as well as investing in new technologies such as hydrogen and electric planes.
“We are not waiting for others to solve this problem for us. We are taking action ourselves”, Walsh said.