The International Air Transport Association (IATA) anticipates airlines in North America will generate the strongest financial performance of any global region, with carriers in the region posting net profits topping $16.4 billion in 2018. This number is up from $15.6 billion in 2017. IATA expects market conditions will continue to be strong, with the 3.4 percent capacity growth expected to be less than the traffic forecast of 3.5 percent.
Overall, North American airlines have generated more than half of global airline profits over the past three years. However, improvements have slowed due to heightening cost pressures, including rising fuel prices and labor costs. But IATA expects these pressures to decrease in 2018.
Globally, IATA is forecasting that industry net profits will reach $38.4 billion in 2018, up from $34.5 billion for 2017. This is due in part to rising passenger numbers (4.3 billion globally), bringing in overall revenues of $824 billion.
“These are good times for the global air transport industry,” said Alexandre de Juniac, IATA’s director general and CEO. “Safety performance is solid. We have a clear strategy that is delivering results on environmental performance. More people than ever are traveling. The demand for air cargo is at its strongest level in over a decade. Employment is growing. More routes are being opened. Airlines are achieving sustainable levels of profitability. It’s still, however, a tough business, and we are being challenged on the cost front by rising fuel, labor and infrastructure expenses.”