Jamaica Gleaner

Expect the cost of your airfare to continue rising, says IATA

THE COST of your next flight is likely to go up. That’s the word from the Internatio­nal Air Transport Associatio­n, which held its annual meeting in Dubai, home to the long-haul carrier Emirates.

While carriers recover from the groundings worldwide from the coronaviru­s pandemic, industry leaders told journalist­s that there are several costs likely to push those ticket prices ever higher.

Part of that comes from worldwide inflation, an ongoing problem since the pandemic started. Jet fuel costs, roughly a third of all airline expenses, remain high. Meanwhile, a global push for the aviation industry to decarbonis­e has more carriers fighting for the little amount of so-called sustainabl­e aviation fuel, or SAF, available in the market.

“The airlines will continue to do everything they can to keep costs in control as much as possible for the benefit of consumers,” said Willie Walsh, the director general of the the Internatio­nal Air Transport Associatio­n, an industry-trade group. “But I think it’s unrealisti­c to expect that airlines can continue to absorb all of the costs. ... It’s not something we like to do, but it’s something we have to do.”

Also pressuring the industry is a pandemic hangover in aircraft production as well, they say. Carriers now keep older planes that burn more fuel flying longer. There also aren’t enough new aircraft to expand routes and increase supply to bring down overall prices.

That warning comes as the IATA estimates globally, airline revenue will reach nearly US$1 trillion in 2024, a record high. There will be 4.96 billion travellers on airplanes this year, with total expenses for carriers reaching US$936 billion — another record high.

But industry profits also are expected to be nearly US$60 billion this year.

In particular, Emirates, a main

driver for Dubai’s economy, saw record profits of US$4.7 billion in 2023 off revenues of US$33 billion.

The Emirates’ results track with those for its base, Dubai Internatio­nal Airport. The world’s busiest airport for internatio­nal

travellers had 86.9 million passengers last year, surpassing numbers for 2019 just before the coronaviru­s pandemic grounded global aviation.

The airport now plans to move to the city-state’s second, sprawling airfield in its southern desert reaches in the next 10 years in a project worth nearly US$35 billion.

Tim Clark, the airline’s president, obliquely acknowledg­ed that on Monday by saying that he didn’t want people to “get boxes of tissues out and play the violins” when warning that the industry’s profit margins sit in the low single digits. However, he contended that as airlines have grown larger and carriers consolidat­ed, cost savings have quietly been passed onto consumers who are now able to book flights across the world.

“It is quite amazing that ticket prices are where they are today,” Clark said. “I think the value-formoney propositio­n that the consumers have had the benefit from for many decades is something that is one of those hidden bits of the narrative.”

Yvonne Manzi Makolo, the CEO of RwandAir, also highlighte­d the taxes and fees imposed on carriers by the countries they operate in. She specifical­ly cited those paid by carriers flying out of African nations as “already ridiculous”.