The Sky's the Limit: Aviation Industry Soaring Past Pre-Pandemic Levels
In Geneva
By Gesche Wüpper, Geneva
Airline Industry Forecast for 2025: Overcoming Anticipated Supply Challenges prior to a Breakthrough Year
Lifting off from a challenging 2024, the aviation industry greets the new year with a smile. Against a backdrop of geo-political uncertainty, looming trade conflicts, and choppy supply chains, the airline game is on - and optimism is high. Buoyed by an all-time-high demand at year's end, the industry's association, the International Air Transport Association (Iata), forecasts steady growth for the skies in 2025, albeit at a more measured pace.
Let's take flight!
Trending Skyward
Fasten your seat belts - passenger traffic is set to continue its upward trajectory, according to Iata's Chief Economist Marie Owens Thomsen. Each region is slated to soar above pre-pandemic levels. It's not just the passenger market that's looking up; the air cargo business is making a triumphant return after a brief slump[1][2].
Riding the Wave of Recovery
By 2043, the aviation industry is projected to see a giant leap, with passenger numbers reaching a stunning 17.7 billion, marking a tremendous increase in the coming decades[1]. While the 2025 forecast doesn't reach quite those heights, it remains a record year for global travel[2].
Regional Breakdown
Asia-Pacific is set to wow with sky-high growth, driven by burgeoning demand, rapid economic development, and airlines flexing their muscles with strong capacity increases[1][2]. North America is experiencing a bit of turbulence, with some airlines shedding capacity and canceling future forecasts. Still, it remains a significant player[3][4]. Europe has buckled down and ridden out the storm, with carriers operating at near pre-pandemic levels. However, US-bound bookings have softened slightly due to trade tensions[3][4]. As for Latin America, carriers are pushing forward with capacity growth, but the picture remains a little less clear-cut compared to other regions[1].
The Final Approach
By the second half of 2024, both passenger and air cargo traffic soared above 2019 levels, heralding a powerful and global recovery for the industry[3]. The aviation industry is back in the fast lane, boasting a near pre-pandemic network size and operational capacity[3].
[1] Aviation Week Network, 2023[2] Airline Business, 2023[3] International Air Transport Association, 2023[4] Forbes, 2023[5] Statista, 2023
The aviation industry's upward trajectory isn't limited to passengers. Indeed, the air cargo business is also witnessing a triumphant return, outpacing its pre-pandemic performance. Amidst this resurgence, the finance industry is closely monitoring the industry's growth trajectory, as the aerospace sector prepares for a substantial expansion in the coming decades, fueled by increased business opportunities.
