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Lufthansa aircraft at Frankfurt Airport: Many people want to travel again

Photo: IMAGO/Arnulf Hettrich

The aviation association IATA has more than doubled its profit forecast for airlines in 2023. Specifically, airlines worldwide expect a profit of 9.8 billion dollars for the current year, up from 4.7 billion dollars a year ago.

"The pandemic years are behind us, and borders are open as normal," IATA Director General Willie Walsh said at the industry association's annual meeting. "Many people not only have to travel, but also want to. And they're going to do it all year long." The outlook for travel would be favored by low unemployment, despite the deteriorating economic outlook. "This gives consumers confidence that they can spend money."

However, flights are currently twice as expensive for some airlines as they were before the corona pandemic, and real cheap flights are currently rare. Nevertheless, the airlines are likely to remain far from their pre-pandemic profit level, also because of higher kerosene prices: In 2019, according to earlier figures, the industry had flown in a profit of 26.4 billion dollars on better utilized aircraft.

High demand despite high inflation

According to IATA estimates, the volume of traffic will grow to 4.35 billion passengers this year. "All in all, we believe this will be a good year for aviation," said IATA CEO Willie Walsh.

So far, even high inflation has not hindered demand. The airlines' most recent quarterly results had been good. The airlines are now preparing for a booming summer business. Revenue is also expected to increase this year, coming in at $803 billion, only slightly below the pre-pandemic level of $838 billion.

However, delivery problems at aircraft manufacturers are causing problems for companies. In addition, there are rising airport charges. This applies in particular to Amsterdam's Schiphol Airport and airports in South Africa. In addition, the profitability of airlines is still too low, Walsh emphasized. Currently, companies earn just $2.25 per passenger – "less than a cup of coffee or a subway ticket."