IATA, the airline industry group, says it has dramatically increased its forecast for 2023 profitability as passenger numbers nearly recover to pre-Covid-19 levels.
According to recent estimates from the International Air Transport Association (IATA), air travel passenger numbers have nearly returned to pre-pandemic levels in what is being touted as a magnificent rebound.
A report issued on Monday at the start of its 2023 annual general meeting in Istanbul, Turkey, said that airlines expect to carry 4.35 billion passengers worldwide this year, not far from the record of 4.54 billion in 2019.
Airlines and tourism were particularly hard hit by Covid-19 restrictions on international travel put in place across the world from early 2020 onwards.
The representative body for the world’s airlines also announced a major upgrade in its forecast for profitability for this year.
It said it now believes that the industry’s net profits for 2023 will hit $9.8 billion, representing a profit margin of 1.2 per cent. Its previous forecast, issued in December, had been for a net profit of $4.7 billion.
The global turnover of airlines should reach $803 billion, within reach of the $838 billion in 2019, according to IATA.
Although the industry’s operating margins will remain relatively low this year, at 1.2%, these profits, the first since the outbreak began, will be a dramatic improvement over the 42 billion dollars lost in 2021 and the abyss of 2020 (137.7 billion).
It did, however, warn that not all geographical regions will return to profitability this year. While airlines in North America, Europe, and the Middle East should be profitable, airlines in Asia-Pacific (-$6.9 billion), Latin America (-$1.4 billion), and Africa (-$500 million) will continue to lose money.
