by Donald Wood
Last updated: 10:55 AM ET, Mon June 5, 2023
Airlines from around the world announced the forecast for the
industry's 2023 profit has more than doubled despite issues meeting demand and
delays associated with the delivery of new planes and parts.
According to Reuters.com,
International Air Transport Association (IATA) director general Willie Walsh said
during the group’s annual summit that the industry’s profit forecast jumped to
$9.8 billion from $4.7 billion, buoyed by travel demand and lower oil prices.
Walsh also revealed that revenue is expected to grow by 9.7
percent to $803 billion this year, but is likely to fall short of the $838
billion earned in 2019 before the coronavirus pandemic shut down domestic and
international flight service.
While carriers continue to highlight strong numbers due to
the summer vacation travel period, Walsh said profit margins of 1.2 percent are
making it hard to repair “damaged balance sheets” and resulting in airlines
making an estimated “$2.25 per passenger.”
“We're probably in either a mild recession or moderate
economy. We can see that,” United Airlines CEO Scott Kirby told Reuters. “I
think actually, in the U.S., we're in a business recession, and the consumer
has just been strong.”
One major issue voiced by airline executives worldwide is
the extended wait times to receive new planes from manufacturers, with averages
reaching at least six months per aircraft. Airbus and Boeing blamed supply
chain issues for the long wait times.
As a result, airline executives have asked the IATA to work
directly with manufacturers to “make sure their frustrations are heard” and the
wait times are eventually reduced.
“Airlines are beyond frustrated,” Walsh said. “A solution
must be found.”
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