Geneva: The International Air Transport Association (IATA) reports that ongoing supply chain disruptions will continue to Hinder Airline performance in 2025, leading to higher costs, operational constraints, and reduced growth potential.
IATA’s latest industry outlook highlights the significant impact of these issues:
Aging Fleet and Declining Aircraft Deliveries
- The average age of the global aircraft fleet has hit a record 14.8 years, up from the long-term average of 13.6 years from 1990 to 2024.
- Aircraft deliveries have dropped sharply, with only 1,254 deliveries expected in 2024, a 30% shortfall from initial projections. While deliveries are expected to increase to 1,802 in 2025, this number is still significantly lower than the previous estimate of 2,293.
- The order backlog for new aircraft has ballooned to 17,000 planes, the highest ever recorded. At current delivery rates, fulfilling these orders would take 14 years, double the pre-pandemic average of six years.
Parked Aircraft and Engine Delays
- Approximately 14% of the global fleet (about 5,000 aircraft) remains parked, a 4% increase from pre-pandemic levels. This includes 700 planes undergoing engine inspections, with the issue likely to persist through 2025.
Triple Whammy for Airlines
According to Willie Walsh, IATA’s Director General, supply chain disruptions are creating a “triple whammy” for airlines:
- Revenue Losses: With load factors at record highs, airlines could deploy additional aircraft profitably if more were available.
- Higher Costs: Aging fleets require more maintenance, consume more fuel, and demand significant capital investments to remain operational.
- Increased Leasing Rates: Exceptional demand for leased aircraft has driven leasing costs for narrow-body planes up by 20-30% compared to 2019.
According to Walsh, “Airlines are still in the process of recovering from the pandemic and must focus on restoring their financial stability. However, supply chain issues from manufacturers are hindering fleet growth and increasing expenses.”
Environmental Impact
Supply chain constraints are also stalling progress in reducing carbon emissions:
- Fuel efficiency between 2023 and 2024 stagnated at 0.23 liters per 100 available tonne kilometers (ATK), reversing the long-term improvement trend of 1.5-2.0% annually.
- Airlines are bearing the brunt of the aviation industry’s commitment to achieving net-zero carbon emissions by 2050, with limited support from manufacturers.
“If manufacturers address supply chain challenges and fulfill their commitments, airlines can speed up fleet upgrades and enhance fuel efficiency.” Walsh emphasized.
Looking Ahead
With delivery rates unlikely to meet demand and a growing backlog of orders, airlines face continued challenges in expanding capacity and meeting environmental goals. Addressing these issues will require significant collaboration across the aviation supply chain to ensure the industry’s sustainable growth and recovery.