NEWS FLASH
The International Air Transport Association (IATA) expects severe supply chain issues to continue to impact airline performance into 2025, raising costs and limiting growth. According to IATA, the average age of the global fleet has risen to a record 14.8 years, a significant increase from the 13.6 years average for the period 1990-2024, because of supply chain issues. Aircraft deliveries have fallen sharply from the peak of 1.813 aircraft in 2018. The estimate for 2024 deliveries is 1.254 aircraft, a 30% shortfall on what was predicted going into the year. In 2025, deliveries are forecast to rise to 1.802, well below earlier expectation for 2.293 deliveries with further downward revisions in 2025 widely seen as quite possible. The backlog (cumulative number of unfulfilled orders) for new aircraft has reached 17.000 planes, a record high. At present delivery rates, this would take fourteen years to fulfil, double the six-year average backlog for the 2013-2019 period. However, the waiting time is expected to shorten as delivery rates increase. The number of “parked” aircraft is 14% (approximately 5.000 aircraft) of the total fleet (35.166 as at December 2024, including Russian-built aircraft). While this has improved recently, parked aircraft remain 4% higher than pre-pandemic levels (equivalent to some 1.600 aircraft). Of these, 700 (2% of the global fleet) are parked for engine inspections. Due to supply chain issues, exceptional demand for leased aircraft has pushed leasing rates for narrow-body aircraft to levels 20-30% higher than in 2019.
Commenting on the development, IATA Director General, Willie Walsh, said, “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. Meanwhile, the aging fleet that airlines are using has higher maintenance costs, burns more fuel, and takes more capital to keep it flying. And, on top of this, leasing rates have risen more than interest rates as competition among airlines intensified the scramble to find every way possible to expand capacity. This is a time when airlines need to be fixing their battered post-pandemic balance sheets, but progress is effectively capped by supply chain issues that manufacturers need to resolve”.
"Load factors are at record highs"
ReplyDeleteDon't tell OU.
Dead men walking.
DeleteAirbus and Beoing and their governments are the real reason for the delays, they are trying to keep the duoploy going
ReplyDeleteAs long as people keep thinking narrowly - that those two companies are the only ones to buy from, the duopoly will continue. Truth be told, Boeing has completely turned into a nightmare these last few years.
DeleteAnd what is IATA doing besides stating the obvious?
ReplyDeleteProviding comprehensive research and statistics behind the said issue
DeleteThey're not a manufacturer nor is it within their right or duty to order Airbus and Boeing around regarding their manufacturing capabilities
Well, this insane growth needed a stop. The infrastructure can’t take this no more, at least not at current rates.
ReplyDelete