Global airline industry's 2018 net profit expected to rise: IATA

Ann Santiago
December 6, 2017

He cautioned that the $38.4 billion the entire global airline industry would make next year is still $10 billion shy of the profit that Apple - a single company - announced for 2016.

To continue to deliver on our full potential, governments need to raise their game-implementing global standards on security, finding a reasonable level of taxation, delivering smarter regulation and building the cost-efficient infrastructure to accommodate growing demand.

"It is still, however, a tough business, and we are being challenged on the cost front by rising fuel, labour and infrastructure expenses", he said. "While restocking cycles are usually short-lived, the growth of e-commerce is expected to support continued momentum in the cargo business beyond the rate of expansion of world trade in 2018", the association added.

This year's profit forecast for the region's airlines has, however, been revised downwards from the $400 million profit IATA forecast in June, which was a 63.6 per cent drop from the $1.1 billion the airlines made in 2016.

That's according to research by IATA, the International Air Transport Association.

IATA said demand to and from North America in particular fell in year-on-year terms for the seventh consecutive month.

"But remember, 2017 was a bad year, so challenges remain", de Juniac told Gulf News on the sidelines of the conference.


Asia-Pacific airlines led all regions with traffic growth of 10.3% compared to the year-ago period, which was up from an 8.7% rise in September.

"Overall unit costs are expected to grow by 4.3 per cent in 2018 [a significant acceleration on the 1.7 per cent increase in 2017]". This will push up the average load factor to a record 81.4 per cent, helping to drive a 3 per cent improvement in yields.

Total capacity climbed by six per cent in the worldwide passenger market segment, while load factor increased one percentage point to 79.4 per cent y-o-y, it said.

Passenger demand growth will likely continue in 2018, based on the global economic upturn of recent months, Oxley said. "Next year, we are expecting Brent crude to be around US$60 and jet fuel to be around US$74 a barrel". "This will outpace an expected 3.5 per cent increase in unit revenues", Pearce said.

But not all the forecasts are so positive, with passenger demand measured in revenue passenger kilometres - measures of traffic for an airline flight - set to rise by only 6%, slightly less than 2017's 7.5% increase.

A slight decline in the operating margin to 8.1%, down from 8.3% in 2017.

Other reports by

Discuss This Article

FOLLOW OUR NEWSPAPER