After severe losses in the Corona crisis, airlines worldwide are currently benefiting from the strong summer business. However, the airlines will probably not be able to reach the pre-crisis level.
Airlines all over the world are looking forward to significant profits in the current year: the industry is likely to generate a surplus of 9.8 billion US dollars in 2023, the International Air Transport Association (IATA) announced at its general assembly in Istanbul. In its previous profit forecast from December last year, the industry association had assumed $4.7 billion.
“The pandemic years are behind us and the borders are open as normal,” said IATA Director General Willie Walsh. “Many people not only have to travel, they also want to. And they will do it all year long.” So far, high inflation has not hampered demand, as the airlines’ latest quarterly results show. The airlines are now preparing for booming summer business.
“Less than a cup of coffee”
The airlines are likely to remain a long way from their profit level from the year before the pandemic, also because of the higher kerosene prices: According to earlier information, the industry had flown a profit of 26.4 billion dollars with better utilized aircraft in 2019.
In addition to the high kerosene prices, delivery problems at the aircraft manufacturers are also causing problems for the companies. Added to this are rising airport fees. This applies in particular to Amsterdam Airport Schipol and airports in South Africa. In addition, the profitability of the airlines is still too low, emphasized Walsh. The companies are currently making just $2.25 per passenger – “less than a cup of coffee or a subway ticket.”
Major order for Airbus
At the same time, aircraft manufacturers are also benefiting from the growing desire to travel: According to insiders, Airbus is about to receive a record order from India. Indian low-cost airline IndiGo wants to order 500 A320s from the European aircraft manufacturer, people familiar with the matter said. So far, however, there has been no official statement from Airbus or IndiGo.
If the deal goes through, it should be worth around $50 billion based on current list prices. However, significant discounts are common in such deals.