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May Air Cargo Demand Up 2.2% Despite Trade Disruptions: IATA
Representative Image The International Air Transport Association (IATA) released data for May 2025 global air cargo markets showing: Total demand, measured in cargo tonne-kilometers (CTK), rose by 2.2% compared to May 2024 levels (+3.0% for international operations). Capacity, measured in available cargo tonne-kilometers (ACTK), increased by 2.0% compared to May 2024 (+2.6% for international operations). “Air cargo demand globally grew 2.2% in May. That is encouraging news as a 10.7% drop in traffic on the Asia to North America trade lane illustrated the dampening effect of shifting US trade policies. Even as these policies evolve, already we can see the air cargo sector’s well-tested resilience helping shippers to accommodate supply chain needs to flexibly hold back, re-route or accelerate deliveries,” said Willie Walsh, IATA’s Director General. Several factors in the operating environment should be noted: Year-on-year, world industrial production rose 2.6% in April 2025. Air cargo volumes grew 6.8% over the same period, outpacing global goods trade growth of 3.8%. Jet fuel prices in May 2025 were 18.8% lower than the previous year and 4.3% below the previous month. Global manufacturing contracted in May, with the PMI falling to 49.1, below the 50 mark that signals growth. New export orders also remained in negative territory at 48, reflecting pressure from recent U.S. trade policy changes. May Regional Performance Asia-Pacific airlines saw 8.3% year-on-year demand growth for air cargo in May, the strongest growth of all regions. Capacity increased by 5.7% year-on-year. North American carriers saw a -5.8% year-on-year decrease in growth for air cargo in May, the slowest growth of all regions. Capacity decreased by -3.2% year-on-year. European carriers saw 1.6% year-on-year demand growth for air cargo in May. Capacity increased 1.5% year-on-year. Middle Eastern carriers saw 3.6% year-on-year increase in demand for air cargo in May. Capacity increased by 4.2% year-on-year. Latin American carriers saw a 3.1% year-on-year increase in demand growth for air cargo in May. Capacity increased 3.5% year-on-year. African airlines saw a 2.1% year-on-year decrease in demand for air cargo in May. Capacity increased by 2.7% year-on-year Trade Lane Growth: A significant decrease in the Asia-North America trade lane was expected and realized as the effect of front-loading faded (moving goods to market in advance of tariffs coming into effect) and changes to the de-minimis exemption on small package shipments (particularly those associated with e-commerce) were enforced. As cargo flows reorganized, several route areas responded with surprising growth. Trade Lane YOY Growth Notes Market Share of Industry Asia-North America -10.7% N/A 24.4% Europe-Asia +13.4% 27 consecutive months of growth 20.5% Middle East-Europe -0.9% N/A 5.7% May Air Cargo Demand Up 2.2% Despite Trade Disruptions Middle East-Asia +10.8% 3 consecutive months of growth 7.3% Within Asia +9.1% 19 consecutive months of growth 7.0% North America Europe +8.2% 16 consecutive months of growth 13.3% Africa-Asia -14.6% N/A 1.4% *Share is based on full-year 2024 CTKs.
IATA: trade disruptions no bar to air cargo growth in May
The International Air Transport Association (IATA) has released its global air cargo market report for May 2025. In the fifth month of the year, total demand as measured in cargo tonne-kilometers (CTK) was up by 2.2 percent compared to May 2024 levels. Capacity in available cargo tonne-kilometers (ACTK), on the other hand, rose by two percent from where it was in May of last year. IATA director-general Willie Walsh said of these increases: “Air cargo demand globally grew 2.2 percent in May, and that is encouraging news as a 10.7 percent drop in traffic on the Asia to North America trade lane illustrated the dampening effect of shifting US trade policies. Even as these policies evolve, already we can see the air cargo sector’s well-tested resilience helping shippers to accommodate supply chain needs to flexibly hold back, re-route, or accelerate deliveries.” Mitigating factors IATA pointed out that the following factors in the global operating environment were taken into consideration for the report: Year-on-year, world industrial production rose 2.6 percent in April 2025, while air cargo volumes grew 6.8 percent over the same period, outpacing global goods trade growth of 3.8 percent; Jet fuel prices in May 2025 were 18.8 percent lower than the previous year and 4.3 percent below the previous month; and Global manufacturing contracted in May, with the PMI falling to 49.1, below the 50 mark that signals growth. New export orders also remained in negative territory at 48, reflecting pressure from recent U.S. trade policy changes. Performance by region in May 2025 Asia-Pacific airlines saw 8.3% year-on-year demand growth for air cargo in May, the strongest growth of all regions. Capacity increased by 5.7% year-on-year. North American carriers saw a -5.8% year-on-year decrease in growth for air cargo in May, the slowest growth of all regions. Capacity decreased by -3.2% year-on-year. European carriers saw 1.6% year-on-year demand growth for air cargo in May. Capacity increased 1.5% year-on-year. Middle Eastern carriers saw 3.6% year-on-year increase in demand for air cargo in May. Capacity increased by 4.2% year-on-year. Latin American carriers saw a 3.1% year-on-year increase in demand growth for air cargo in May. Capacity increased 3.5% year-on-year. African airlines saw a 2.1% year-on-year decrease in demand for air cargo in May. Capacity increased by 2.7% year-on-year With regard to trade lane growth, a significant decrease in the Asia-North America trade lane was expected and realised as the effect of front-loading faded (moving goods to market in advance of tariffs coming into effect) and changes to the de-minimis exemption on small package shipments (particularly those associated with e-commerce) were enforced. As cargo flows reorganised, several route areas responded with surprising growth.
IATA brings airlines and SAF producers together through new SAF Matchmaker platform
The International Air Transport Association (IATA) announced the release of the Sustainable Aviation Fuel (SAF) Matchmaker platform earlier today, 27th June. SAFE Matchmaker was developed to facilitate SAF procurement between airlines and SAF producers by matching requests for SAF supply with offers. When there is a match, airlines and suppliers can connect and take their negotiation offline to agree on specific terms including price and payment terms. According to IATA chief economist and senior vice-president for sustainability Marie Owens Thomsen: “To reach net zero carbon emissions by 2050, we need an accessible, transparent, liquid, and efficient SAF market. The SAF Matchmaker is another example of the work that IATA is putting in place to create a fully functioning market for SAF. The SAF Matchmaker platform will accelerate the uptake of SAF by reducing the costs and complexity that airlines face when searching for SAF suppliers.” How does it work? The SAF Matchmaker supports spot purchases as well as offtake agreements and is initially available to airlines and SAF suppliers only. In due course, other SAF buyers such as non-aviation corporations will also be able to participate. This innovative matching platform is hosted on the Aviation Energy Hub, a centralised digital space designed to provide the aviation industry with access to practical tools that support aviation energy management. Addressing key points of concern Specifically, the SAF Matchmaker addresses three critical issues: Efficiency: The availability of a central platform will simplify SAF procurement by making it easier and faster for all parties to connect without additional fees. It will therefore facilitate further development of the voluntary market for SAF purchasing. Connectivity: SAF producers and suppliers can post available or planned SAF volumes while airlines are able to register their interest in purchasing shown or desired SAF volumes. Once connections are made, subsequent trades will take place outside the platform. Visibility: The platform carries comprehensive information regarding the available SAF, such as volumes, feedstock used, the location and technology of production, the emissions reductions, as well as compliance with the Carbon Offsetting Reduction Scheme for International Aviation (CORSIA) or the European Union’s Renewable Energy Directive (EU RED).
Etihad Airways codeshares with STARLUX Airlines
Etihad Airways has signed a strategic codeshare agreement with Taipei-based STARLUX Airlines, expanding customer access to Northeast Asia and strengthening Abu Dhabi's position as a gateway between East and West. The partnership, announced at the International Air Transport Association Annual General Meeting in New Delhi, enables Etihad customers to connect seamlessly to key Japanese cities including Nagoya, Sapporo, and Fukuoka via Taipei, whilst offering STARLUX passengers direct access to Etihad's European network through Abu Dhabi. Etihad will launch daily flights between Abu Dhabi and Taipei on 7 September 2025, operated by Boeing 787 Dreamliner aircraft. The new route creates the foundation for the codeshare partnership, positioning Taipei as a gateway for Etihad's expansion into Northeast Asia. Etihad customers booking through etihad.com and the airline's mobile app will benefit from streamlined travel with single-ticket bookings, coordinated check-in processes, and automatic baggage transfers to final destinations across STARLUX's Asia-Pacific network. The agreement also opens new pathways for STARLUX passengers to reach European destinations including Prague, Madrid, and Barcelona via Abu Dhabi, positioning the emirate as an attractive transit hub for Asian travellers bound for Europe. Both airlines will launch joint marketing initiatives in Taiwan and establish a reciprocal frequent flyer programme by year-end, allowing Etihad Guest members to earn and redeem miles across both networks. Arik De, Chief Revenue and Commercial Officer at Etihad Airways, said: "This partnership with STARLUX Airlines opens new market opportunities in Northeast Asia, giving our customers access to Japan's key business and leisure destinations through Taipei. STARLUX Airlines’ reputation for premium service aligns perfectly with our standards, and together we're offering travellers more choice and convenience when connecting across three continents." Simon Liu, Chief Strategy Officer of STARLUX Airlines, said: "Our partnership with Etihad Airways marks a significant milestone in STARLUX Airlines' global expansion, laying the foundation for future European routes. As one of the Middle East's leading carriers, Etihad is globally recognised for its innovation and premium service—values that strongly align with the STARLUX brand. By leveraging Abu Dhabi's role as a major hub, this codeshare allows us to rapidly extend our network into Europe, offering passengers a wider range of travel options. We also look forward to deepening collaboration on mileage accrual and premium services to ensure an exceptional experience for customers." The codeshare agreement builds on Etihad's strategic network expansion, which has seen the airline grow to serve over 90 destinations worldwide. The partnership with STARLUX further demonstrates Abu Dhabi's appeal as a premium transit destination, offering travellers world-class facilities at Zayed International Airport alongside the option to extend layovers with Etihad's complimentary Abu Dhabi Stopover programme. Codeshare flights will be available for booking through etihad.com, the Etihad app, and travel partners, with services expected to commence following regulatory approvals.
Luis Gallego Chairs IATA Board
The International Air Transport Association (IATA) announced that Luis Gallego, CEO of International Airlines Group (IAG), has assumed his duties as Chair of the IATA Board. His one-year term began at the conclusion of the 81st IATA Annual General Meeting in New Delhi, India, on 2 June 2025. Gallego is the 83rd Chair of the IATA Board on which he has served since 2018. Gallego succeeds IndiGo CEO Pieter Elbers, who will continue to serve on the Board. “I am honored to be taking up the position of Chair of the IATA Board. The airline industry faces significant challenges—accelerating environmental action, managing geopolitical shifts and supply chain issues, and dealing with concerns over infrastructure capacity and costs. At the same time, the industry has incredible strengths to call on— most of all the quality of the people that strive to make aviation a safe, secure and rewarding experience for millions of travelers every day. IATA has a vital role in harnessing these human and technical resources to deliver leadership and innovation. I look forward to playing my part in steering IATA in its long mission for a strong and successful airline industry,” said Gallego. Gallego has nearly 30 years of broad experience in the aviation industry. He became IAG’s chief executive in September 2020, joining from Iberia, where he was chairman and chief executive from January 2014. During his tenure at Iberia, he turned the airline around and improved its efficiency, customer service and brand. Before that, Gallego launched Iberia Express, as chief executive from January 2012, making the new Iberia subsidiary one of the most efficient and punctual airlines in Europe. Gallego joined Iberia Express from Vueling where he was chief operating officer from 2009, when the airline merged with the low-cost carrier Clickair which he co-founded in 2006. He held various posts at Spanish regional airline Air Nostrum between 1997 and 2006. “I look forward to working with Luis to deliver an agenda of IATA activities that are critical to the current and future success of our member airlines. Luis has a long and deep involvement with the complex issues which are top priorities for our Association—facilitating net zero carbon emissions by 2050, achieving a smart approach to regulation and ensuring a capacity and cost structure that can meet the growing demands for air connectivity. I also want to thank Pieter Elbers for his strong support and leadership over the past year, and in particular for his hosting of a spectacular and invigorating AGM in India,” said Willie Walsh, IATA’s Director General. Chair Elect and Board Appointments IATA announced Roberto Alvo, CEO of LATAM Airlines Group, to serve as Chair of the Board from June 2026, following Gallego’s term
Air New Zealand’s David Morgan appointed to the New Zealand Order of Merit
Air New Zealand announced that Captain David Morgan was appointed an officer of the New Zealand Order of Merit (ONZM) in the 2025 King’s Birthday Honours List. Morgan held the positions of chief flight operations and safety officer as well as chief pilot for 40 years, having joined ANZ in May 1985. This prestigious honour recognises his extraordinary contributions to aviation safety, leadership, and mentoring in both New Zealand and the global aviation stage throughout his storied career. A pillar of the industry Air New Zealand chief executive Greg Foran remarked that Morgan’s influence is deeply embedded into the airline’s DNA. Foran said: “When people think of Air New Zealand, many will think of Captain David Morgan. His leadership has helped define who we are today: an airline built on safety, professionalism, and a strong purpose. David has played an extraordinary role shaping a culture of safety, integrity, and professionalism at Air New Zealand that has seen us repeatedly recognised as the world’s safest airline. We’re incredibly proud of David and thrilled to see his remarkable contribution honoured in this way." ANZ chair Dame Therese Walsh added that Morgan’s service has been nothing short of exceptional. She said: “His influence spans every corner of aviation from safety and sustainability to mentoring the next generation of leaders. He has represented the airline and New Zealand on the global stage countless times and has also worked tirelessly in New Zealand to support young people coming into the industry. This honour not only reflects not just his deep expertise, but also the generosity with which he gives his time to others. On behalf of the Board, we extend our heartfelt congratulations and gratitude to David for his ongoing service to the airline.” A legend in global aviation Captain Morgan began his journey with Air New Zealand in 1985, becoming its chief pilot in 2003. In 2005, he joined the airline’s executive board where he remained until earlier this year when he stepped down from his role. At present, he is poised to begin flying ANZ’s Airbus 320 fleet. Internationally, David’s tenure as chair of the International Air Transport Association’s (IATA) Operations Advisory Council, along with contributions to ICAO, have elevated Air New Zealand’s standing on the world stage.
Airline Profitability to Strengthen Slightly in 2025 Despite Headwinds: IATA
The International Air Transport Association (IATA) announced updates to its 2025 airline industry financial outlook, showing improved profitability over 2024 and resilience in the face of global economic and political shifts. Highlights from the expected 2025 financial performance include: Net profits at $36.0 billion, improved from the $32.4 billion earned in 2024, but slightly down on the previously projected $36.6 billion (December 2024). Net profit margin at 3.7%, improved from the 3.4% earned in 2024 and the previously projected 3.6%. Return on invested capital at 6.7%, improved from the 6.6% earned in 2024 and largely unchanged from previous projections. Operating profits at $66.0 billion, improved from an estimated $61.9 billion in 2024, but down from the previously projected $67.5 billion. Total revenues at a record high of $979 billion (+1.3% on 2024, but below the $1 trillion previously projected). Total expenses at $913 billion (+1.0% on 2024, but below the previously projected $940 billion). Total traveler numbers reaching a record high 4.99 billion (+4% on 2024, but below the previously projected 5.22 billion). Total air cargo volumes reaching 69 million tonnes (+0.6% on 2024, but below the previously projected 72.5 million tonnes). “The first half of 2025 has brought significant uncertainties to global markets. Nonetheless, by many measures including net profits, it will still be a better year for airlines than 2024, although slightly below our previous projections. The biggest positive driver is the price of jet fuel which has fallen 13% compared with 2024 and 1% below previous estimates. Moreover, we anticipate airlines flying more people and more cargo in 2025 than they did in 2024, even if previous demand projections have been dented by trade tensions and falls in consumer confidence. The result is an improvement of net margins from 3.4% in 2024 to 3.7% in 2025. That’s still about half the average profitability across all industries. But considering the headwinds, it’s a strong result that demonstrates the resilience that airlines have worked hard to fortify,” said Willie Walsh, IATA’s Director General. Perspective “Perspective is critical to put into context such large industry-wide aggregate figures. Earning a $36 billion profit is significant. But that equates to just $7.20 per passenger per segment. It’s still a thin buffer and any new tax, increase in airport or navigation charge, demand shock or costly regulation will quickly put the industry’s resilience to the test. Policymakers who rely on airlines as the core of a value chain that employs 86.5 million people and supports 3.9% of global economic activity, must keep this clearly in focus,” said Walsh. Outlook Drivers Gross Domestic Product (GDP) is the traditional driver of airline economics. However, although global GDP growth is expected to fall from 3.3% in 2024 to 2.5% in 2025, airline profitability is expected to improve. This is largely on the back of falling oil prices. Meanwhile, continued strong employment and moderating inflation projections are expected to keep demand growing, even if not as fast as previously projected. Efficiency is another significant driver of the outlook. Passenger load factors are expected to reach an all-time high in 2025 with a full-year average of 84.0%, as fleet expansion and modernization remains challenging amid supply chain failures in the aerospace sector. Overall, total revenues are expected to grow by 1.3%, outpacing a 1.0% increase in total expenses, shoring up industry profitability. Revenue Industry revenues are expected to reach a historic high of $979 billion in 2025 (+1.3% on 2024). Passenger Revenues Passenger revenues are expected to reach $693 billion in 2025 (+1.6% on 2024), an all-time high. This will be bolstered by an additional $144 billion in ancillary revenues (+6.7% on 2024). Passenger growth (measured in Revenue Passenger Kilometers/RPK) is expected to be 5.8%—a significant normalization after the exceptional double-digit growth of the pandemic recovery. It is expected that passenger yields will fall by 4.0% compared with 2024. This is largely reflective of the impact of lower oil prices and strong industry competition. This will continue the trend of travelers benefiting from ever-more affordable air travel. The real average return airfare (in 2024 US dollars) is expected to be $374 in 2025. This is 40% below 2014 levels. IATA’s April 2025 polling data supports projections for demand growth: Some 40% of respondents expect to travel more over the next 12 months than they did in the previous 12-month period. The majority (53%) said that they expect to travel as much as they did in the previous 12 months. Only 6% reported that they expect to travel less. 2 Airline Profitability to Strengthen Slightly in 2025 Despite Headwinds Some 47% of respondents expect to spend more on travel over the next 12 months than they did in the previous 12 months. An almost equal proportion (45%) expect to spend the same on travel over the next 12 months while only 8% expect to spend less. Although 85% expected trade tensions to impact the economy in which they reside and 73% expect to be personally impacted, 68% of business travelers (50% of those polled) expected increased business travel amid trade tensions to visit customers, and 65% said trade tensions would have no impact on their travel habits. Cargo Revenues Cargo revenues are expected to be $142 billion in 2025 (-4.7% on 2024). This is primarily based on the expected impact of reduced GDP growth largely influenced by trade dampening protectionist measures, including tariffs. As a result, air cargo growth is expected to slow to 0.7% in 2025 (from 11.3% in 2024). The cargo yield is also expected to reduce by 5.2%, reflecting a combination of slower demand growth and lower oil prices. Although significant uncertainty remains on how trade tensions will evolve over the year, as of April cargo demand was holding up well with a 5.8% year-on-year increase. Expenses Industry expenses are expected to grow to $913 billion in 2025 (+1.0% on 2024). Jet fuel is expected to average $86/barrel in 2025 (well below the $99 average in 2024), translating into a total fuel bill of $236 billion, accounting for 25.8% of all operating costs. This is $25 billion lower than the $261 billion in 2024. Recent financial data show minimal fuel hedging activity over the past year, indicating that airlines will generally benefit from the reduced fuel cost. It is not expected that fuel will be impacted by trade tensions. Sustainable Aviation Fuel (SAF) production is expected to grow to two million tonnes (Mt) in 2025, accounting for just 0.7% of airline fuel use. SAF production will double from the 1 Mt produced in 2024 (all of which was purchased by airlines), but production needs an exponential expansion to meet the demands of the industry’s commitment to net zero carbon emissions by 2050. IATA estimates that the average cost of SAF in 2024 was 3.1 times that of jet fuel, for a total additional cost of $1.6 billion. In 2025, the global average cost for SAF is expected to be 4.2 times that of jet fuel. This extra cost is largely the result of SAF 'compliance fees’ being levied by European fuel suppliers to hedge their potential costs as a result of European SAF mandates to include 2% SAF in the jet fuel supply. “The behavior of fuel suppliers in fulfilling the SAF mandates is an outrage. The cost of achieving net zero carbon emissions by 2050 is estimated to be an enormous $4.7 trillion. Fuel suppliers must stop profiteering on the limited SAF supplies available and ramp up production to meet the legitimate needs of their customers,” said Walsh. 3 Airline Profitability to Strengthen Slightly in 2025 Despite Headwinds The cost of the Carbon Offsetting Reduction Scheme for International Airlines (CORSIA) to airlines is expected to reach $1 billion in 2025. The market for CORSIA credits will grow, but Guyana is the only country to have issued certificates for the high-quality credits that the scheme requires. Fleet/Supply Chain The aircraft backlog exceeds 17,000 (sharply up from the 10,000-11,000 pre-pandemic), with an implied wait time of 14 years. Should states exit from a multilateral agreement exempting aircraft from tariffs, supply chain constraints and production limitations could be further aggravated. Supply chain issues have had significant negative impacts on airlines: driving-up leasing costs, increasing the average fleet age to 15 years (from 13 in 2015), cutting the fleet replacement rate to half the 5-6% of 2020, and reducing the efficiency of fleet utilization (using larger aircraft than needed on some routes, for example). In 2025, 1,692 aircraft are expected to be delivered. Although this would mark the highest level since 2018, it is almost 26% lower than year-ago estimates. Further downward revisions are likely, given that supply chain issues are expected to persist in 2025 and possibly to the end of the decade. Engine problems and a shortage of spare parts exacerbate the situation and have caused record high groundings of certain aircraft types. The number of aircraft younger than 10 years in storage is currently more than 1,100, constituting 3.8% of the total fleet compared with 1.3% between 2015 and 2018. Nearly 70% of these grounded aircraft are equipped with PW1000G engines. “Manufacturers continue to let their airline customers down. Every airline is frustrated that these problems have persisted so long. And indications that it could take until the end of the decade to fix them are off-the-chart unacceptable!” said Walsh. Risks With ongoing geopolitical and economic uncertainties, the most significant risks to the industry outlook include: Conflict: The resolution of conflicts such as the Russia-Ukraine war would have a benefit for airlines in reconnecting de-linked economies and reopening airspace. Conversely, any expansion of military activity could have a dampening effect. Trade tensions: Tariffs and prolonged trade wars dampen demand for air cargo and potentially travel. Additionally, the uncertainty over how the Trump Administration’s trade policies will evolve could hold back critical business decisions that drive economic activity, and with it the demand for air cargo and business travel. Fragmentation: Global standards have always been critical for aviation. Fragmentation of global standards or weakening of multilateral institutions and agreements could bring additional costs to airlines with a more complex or unstable regulatory environment. This includes the evolution of policies on climate, trade, facilitation and a myriad of other matters impacting airline strategic decision-making and operations. 4 Airline Profitability to Strengthen Slightly in 2025 Despite Headwinds Oil prices: Oil prices are a major driver of airline profitability. The complex array of factors impacting oil prices (including economic growth projections, the amount of extraction activity undertaken, policies on decarbonization, sanctions, availability of refining capacity, and transport blockages) can produce quick shifts in pricing volatility with significant impact on airline financial prospects. Regional Roundup All regions are expected to deliver collective net profits in 2025. Most will see their financial performance improve compared with 2024, with Latin America being the exception. Profitability, however, varies widely by carrier and by region. The collective net profit margin of African airlines is expected to be the weakest at 1.3% while carriers in the Middle East are forecast to be the strongest at 8.7%. North America 2024 Net Profit (e) (net margin) Per passenger 2025 Net Profit (f) (net margin) Per passenger 2025 Demand (RPK) 2025 Capacity (ASK) $11.5 b (3.5%) $10.1 $12.7 b (4.0%) $11.1 +0.4% +1.3% North America will generate the highest absolute profit among the regions even as it is expected to be affected by a slowdown in the US economy, with increased tariffs likely to erode both consumer and business sentiment, dampening consumption and investment. The persistent shortage of pilots and engine reliability problems, particularly in the low-cost sector, will limit growth in the region. Europe 2024 Net Profit (e) (net margin) Per passenger 2025 Net Profit (f) (net margin) Per passenger 2025 Demand (RPK) 2025 Capacity (ASK) $9.6 b (3.8%) $11.3 b (4.3%) +6.0% +5.9% 5 Airline Profitability to Strengthen Slightly in 2025 Despite Headwinds $8.0 $8.9 Europe is expected to benefit from strong passenger demand, driven by growth in the low-cost sector. More of their aircraft fleet will return to service following engine-related grounding, and the EU’s open skies agreements with North Africa will provide market opportunities. A stronger Euro will boost profitability for all carriers in the region with costs (such as fuel) mainly denominated in US dollars. Asia Pacific 2024 Net Profit (e) (net margin) Per passenger 2025 Net Profit (f) (net margin) Per passenger 2025 Demand (RPK) 2025 Capacity (ASK) $4.0 b (1.6%) $2.3 $4.9 b (1.9%) $2.6 +9.0% +6.9% Asia Pacific is the largest market in terms of RPK, with China accounting for over 40% of the region’s traffic. Passenger demand is expected to be strong given the relaxation in visa requirements in several Asian countries, particularly China, Vietnam, Malaysia and Thailand. This will support both international tourism and travel within the region. However, the economic landscape poses some challenges, with the GDP forecast for the region, particularly China, having been revised down. Although flights between China and the United States are still limited to 100 weekly frequencies and significantly below pre-COVID levels, overcapacity issues are showing signs of improvement due to better fleet deployment between domestic and international travel. Latin America 2024 Net Profit (e) (net margin) Per passenger 2025 Net Profit (f) (net margin) Per passenger 2025 Demand (RPK) 2025 Capacity (ASK) $1.3 b $1.1 b +5.8% +7.8% 6 Airline Profitability to Strengthen Slightly in 2025 Despite Headwinds (2.8%) $4.1 (2.4%) $3.4 Latin America is home to some airlines that are thriving and others that are experiencing significant financial difficulties. The region’s airlines continue to be impacted by weak domestic currencies as major cost items, such as fleet expenses and debt servicing, are paid in US dollars. Argentina’s signing of open skies agreements with a number of countries is positive and will enhance connectivity and competition for the benefit of airlines and passengers. However, the proposed 26.5% VAT on tickets in Brazil could have a significant impact on the market. This is the only region to see profitability decrease compared with 2024. Middle East 2024 Net Profit (e) (net margin) Per passenger 2025 Net Profit (f) (net margin) Per passenger 2025 Demand (RPK) 2025 Capacity (ASK) $6.1 b (8.9%) $28.5 $6.2 b (8.7%) $27.2 +6.4% +4.6% The Middle East will generate the highest net profit per passenger among the regions. Robust economic performance is supporting strong air travel demand, both for business and leisure travel. However, with delays in aircraft delivery, the region will see limitations in capacity as airlines embark on retrofit projects to modernize their fleet, hence limiting growth. Africa 2024 Net Profit (e) (net margin) Per passenger 2025 Net Profit (f) (net margin) Per passenger 2025 Demand (RPK) 2025 Capacity (ASK) $0.2 b $0.2 b +8.0% +7.3% 7 Airline Profitability to Strengthen Slightly in 2025 Despite Headwinds (1.0%) $1.2 (1.1%) $1.3 Africa’s carriers face high operational costs and a low propensity for air travel expenditure in many of their home markets. A shortage of aircraft and spare parts is dampening growth in the region. The shortage of foreign currency in some economies, particularly US dollars, is adding to the region’s challenges. Despite these challenges, there is sustained demand for air travel in Africa. The Traveler’s Viewpoint Air travel delivers value to consumers. An April 2025 public opinion poll (commissioned by IATA covering 14 countries with 6,500 respondents who have taken at least one trip in the last 12 months) revealed that 97% of travelers expressed satisfaction with their travel (58% indicating they were highly satisfied). Moreover, 89% agreed that air travel makes their lives better, 81% appreciated the availability of choice in travel planning, and 78% agreed that air travel is good value for money. Passengers are counting on a safe, sustainable, efficient, and profitable airline industry. IATA public opinion polling demonstrated the important role that travelers see the airline industry playing: 90% agreed that air travel is a necessity for modern life 90% agreed that air connectivity is critical to the economy 89% said that air travel has a positive impact on societies 82% said that the global air transport network is a key contributor to the UN Sustainable Development Goals 84% care about the success of the aviation industry 88% care about their ability to fly in the future The air transport industry is committed to its goal of achieving net zero CO2 emissions by 2050. Travelers are expressing high levels of confidence in this endeavor with 81% agreeing that the industry is demonstrating a commitment to work together to achieve this ambitious aim. Some 77% agreed that aviation leaders are taking the climate challenge seriously, significantly above the 64% recorded for government leaders and 60% for the oil sector.
Air Cargo Demand up 5.8% in April
The International Air Transport Association (IATA) released data for April 2025 global air cargo markets. “Air cargo demand grew strongly in April, with volumes up 5.8% year-on-year, building on March’s solid performance. Seasonal demand for fashion and consumer goods—front-loading ahead of US tariff changes—and lower jet fuel prices have combined to boost air cargo. With available capacity at record levels and yields improving, the outlook for air cargo is encouraging. While April brought good news, stresses in world trade are no secret. Shifts in trade policy, particularly in the US, are already reshaping demand and export dynamics. Airlines will need to remain flexible as the situation develops over the coming months," said Willie Walsh, IATA’s Director General. Several factors in the operating environment should be noted: Year-on-year, world industrial production rose 3.2% in March. Air cargo growth outpaced global goods trade, which increased by 6.5% over the previous month. Jet fuel prices dropped 21.2% year-on-year and 4.1% month-on-month, the third consecutive monthly decrease. The global manufacturing PMI rose to 50.5 in April, signaling expansion for the fourth consecutive month. However, the PMI for new export orders fell 2.8 points to 47.2, remaining below the 50 threshold for growth. Air Cargo Demand up 5.8% in April April Regional Performance Asia-Pacific airlines saw 10.0% year-on-year demand growth for air cargo in April. Capacity increased by 9.4% year-on-year. North American carriers saw 4.2% year-on-year demand growth for air cargo in April. Capacity increased by 4.6% year-on-year. European carriers saw 2.9% year-on-year demand growth for air cargo in April. Capacity increased 3.3% year-on-year. Middle Eastern carriers saw 2.3% year-on-year increase in demand for air cargo in April, the slowest among the regions. Capacity increased by 5.5% year-on-year. Latin American carriers saw a 10.1% year-on-year increase in demand growth for air cargo in April, the strongest growth among the regions. Capacity increased 8.5% year-on-year. African airlines saw a 4.7% year-on-year increase in demand for air cargo in April. Capacity increased by 9.7% year-on-year. Trade Lane Growth: All international routes experienced growth in April, except for Middle East Europe, Africa-Asia, and intra-European route. Trade Lane YOY Growth Notes Market Share of Industry Asia-North America +1.9% 2 consecutive months of growth 24.4% 2 Air Cargo Demand up 5.8% in April Europe-Asia +11.3% 26 consecutive months of growth 20.5% Middle East-Europe -4.6% N/A 5.7% Middle East-Asia +6.7% 2 consecutive months of growth 7.3% Within Asia +10.0% 18 consecutive months of growth 7.0% North America Europe +9.6% 15 consecutive months of growth 13.3% Africa-Asia -7.9% N/A 1.4% Within Europe -8.8% N/A 2.0% *Share is based on full-year 2024 CTKs.
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