GENEVA, 7 January 2020: Airlines should turn over a profit of USD29.3 billion profit in 2020, according to the latest International Air Transport Association (IATA) forecast.
It would represent an improvement, over a net profit of USD25.9 billion expected in 2019 (revised downward from a USD28 billion forecast in June).
If achieved, 2020 would mark the global industry’s 11th consecutive year in the black. In 2020 IATA expects a return on invested capital to be about 6%, as against the 5.7% expected in 2019; the net profit margin was forecast at 3.4%, up from 3.1% for 2019; and overall industry revenue was estimated to reach USD872 billion this year, up from USD838 billion in 2019.
In addition, the industry operating expenses were projected to climb by 3.5 per cent to USD823 billion, from USD796 billion in 2019. IATA also expects passenger numbers to reach 4.72 billion, up by 4%, compared with the 4.54 billion realised in 2019.
“Negative developments contributed to softer passenger and cargo demand and corresponding weaker revenue growth, as passenger yields fell 3%, compared to 2018,” IATA reported.
“The big question for 2020 is how capacity will develop, particularly when, as expected, the grounded 737 MAX aircraft will return to service and delayed deliveries arrive,” said IATA’s director general and CEO, Alexandre de Juniac.
In 2020, IATA said it expects GDP to expand by 2.7% (marginally above the 2.5% growth in 2019).
(Source: IATA)
