IATA predicts supply chain challenges will affect airline operations until 2025
The International Air Transport Association (IATA), which represents approximately 340 airlines that account for over 80% of global air traffic, has announced that the aviation sector will continue to be impacted by supply chain challenges until at least 2025. These issues, it says, are expected to increase operational costs and hinder the industry’s growth potential.
The International Air Transport Association (IATA), which represents approximately 340 airlines that account for over 80% of global air traffic, has announced that the aviation sector will continue to be impacted by supply chain challenges until at least 2025. These issues, it says, are expected to increase operational costs and hinder the industry’s growth potential.
In a statement released on Tuesday, IATA projected that the global aircraft fleet’s average age has risen to a record 14.8 years, up from the previous average of 13.6 years. This indicates a delay in the delivery of new aircraft, exacerbating existing operational challenges.
According to IATA’s estimates, the number of aircraft deliveries for 2024 is expected to be only 1,254, a 30% shortfall from earlier projections. The outlook for 2025 is similarly subdued, with only 1,802 deliveries expected, significantly below the original forecast of 2,293. The global backlog for new aircraft has now ballooned to 17,000, and at the current delivery rate, it could take up to 14 years to fulfill this backlog—twice the six-year average backlog seen between 2013 and 2019.
IATA further highlighted the issue of parked aircraft or those on the ground (AOG), which now accounts for 14% of the total global fleet. Around 2% of these are parked for engine inspections. This issue, combined with slow deliveries of new planes, continues to affect airline revenues and operational capacity.
Willie Walsh, IATA’s Director General, emphasized that the current supply chain bottleneck is putting tremendous pressure on airline profitability. He explained, “The supply chain issues are frustrating every airline with a triple whammy on revenues, costs, and environmental performance. Load factors are at record highs, and there is no doubt that if we had more aircraft, they could be profitably deployed, so our revenues are being compromised.”
Additionally, airlines are dealing with an aging fleet, which not only incurs higher maintenance costs but also burns more fuel, resulting in greater environmental impact. Leasing rates for aircraft have also risen dramatically, outpacing interest rates due to fierce competition among airlines to secure available planes. This further adds to the financial strain as airlines attempt to recover from the pandemic’s economic fallout.
While IATA remains committed to achieving net-zero carbon emissions by 2050, Walsh expressed frustration over the role supply chain issues are playing in slowing down progress toward this goal. He pointed out that delays in the delivery of new aircraft, which are more fuel-efficient, are hindering airlines’ ability to reduce their carbon footprints.
“Manufacturers are letting down their airline customers, and that is directly impacting airlines’ efforts to limit their carbon emissions. If the aircraft and engine manufacturers could resolve their issues and meet their promises, we’d have a more fuel-efficient fleet in the air,” Walsh added.
As the aviation industry navigates these ongoing supply chain challenges, airlines are grappling with a critical need for new aircraft to meet growing demand while balancing the financial, operational, and environmental pressures that have intensified post-pandemic. The resolution of these issues will be crucial in determining the industry’s ability to recover and meet its long-term sustainability goals.
Sources By Agencies
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