Global airline industry may perform better in 2020 on the back of higher projected world GDP growth and favourable energy prices, which certainly is good news for a sector that generates considerable revenue and employs millions around the globe.
According to the International Air transport Association (IATA), the global airline industry may produce net profit in excess of of $29bn in 2020, improved over a net profit of $25.9bn expected this year.
If achieved, 2020 will mark the industry’s 11th consecutive year in the black.
Aviation is an amazing industry. It supports $2.7tn of economic activity, equivalent to 3.6% of global GDP.
In 1945 some 9mn people travelled by air. Today, the air transport industry lifts that same number, on average, but every 18 hours!
This year, over four-and-a-half billion passengers and 61mn tonnes of freight will travel across a network of more than 22,000 unique city pairs connected by air, IATA revealed at a recent media event in Geneva. That’s more than double the number of routes that were available in 1998.
Certainly, flying is becoming more affordable. The average return fare in 2019 before surcharges and tax is forecast to be 62% lower than in 1998, after adjusting for inflation.
This means that young people in emerging economies are exposed to travel opportunities that their parents could only have dreamed of at the same age. And this opens a world of possibilities to experience other places and cultures, to learn, to find employment, or to make global connections.
Travellers can also fly with confidence, because aviation is the safest form of long-distance travel the world has known.
Flying’s vital role is recognised in the UN’s Sustainable Development Goals. Aviation plays a part in achieving 15 of the 17 SDGs, indicating the fundamental relevance of this industry to addressing humankind’s toughest challenges.
It is encouraging to see that IATA and the global aviation industry expect 2020 to be a better year. But the industry continues to face severe challenges.
Trade wars are the biggest challenge to the global aviation industry. Trade wars produce no winners.
Air cargo business is going through some tough times with demand falling in the face of the trade war between the US and China, the deterioration in global trade, and a broad-based slowing in economic growth.
And while respecting the right of countries to protect their borders, the industry believes that greater connectivity makes our world a better place. It is part of the DNA of an industry with a mission to bring people closer as a global community.
There are some forces in this world today that are working against the freedom to fly and to do business. And that’s why the global aviation industry led by IATA continue to take a strong stance that we are better off with borders that are open to people- and to trade.
Simply put, flying is freedom. That freedom grows prosperity and changes people’s lives for the better — even if they don’t fly. And access to that freedom is certainly greater than it has ever been.
