A top global industry body revised down its key forecasts for traffic and profit this year, citing "headwinds" for the global economy, with industry chiefs warning of the risk of increased tariffs impacting the sector.
The head of the International Air Transport Association (IATA) said on Monday that growing trade barriers risked damaging the economy and the air travel sector, and "unacceptable" plane delivery delays were frustrating growth plans at a time of record passenger numbers.
IATA now estimates that fewer than 5 billion air journeys will take place this year, compared with the previously forecasted 5.22 billion.
"Like all forms of connectivity, flying makes the world more prosperous," IATA Director General Willie Walsh said at the group's annual meeting in New Delhi.
"That stands in contrast to isolationism, trade barriers and the fragmentation of the multilateral rules-based system. These destroy wealth and lower living standards. For the times we live in, this is an important message," he said.
Walsh also said that the first half of 2025 "has brought significant uncertainties to global markets."
But he added: "Considering the headwinds, it's a strong result that demonstrates the resilience that airlines have worked hard to fortify."
Cumulative airline profits will reach $36 billion this year, which is $600 million less than expected, IATA said.
Commercial aviation revenues are expected to remain below the $1 trillion forecast in the previous December projections, with IATA now reporting $979 billion.
Walsh, addressing IATA delegates, called for the aviation sector to be spared from increased tariffs, though he did not name U.S. President Donald Trump, who unveiled sweeping duties on trading partners in April.
Trump's sweeping tariffs have stoked fears of an economic slowdown and squeezed discretionary spending, prompting many consumers, especially in the United States, to delay or scale back travel plans.
They also threaten a decades-old pact between more than 30 countries to eliminate duties on aircraft and their parts.
While Walsh said there was no indication aircraft prices had increased due to tariffs, he said airlines would resist any attempt by aerospace manufacturers to raise prices and called for governments to "keep aerospace out of trade wars."
IATA represents some 300 airlines accounting for more than 80% of global traffic.
While looking at profits, Walsh warned that "perspective is critical" to put industrywide figures into context, saying that per passenger, it was still a narrow margin.
"It's still a thin buffer and any new tax, increase in airport or navigation charge, demand shock or costly regulation will quickly put the industry's resilience to the test," he said.
"Policymakers who rely on airlines as the core of a value chain that employs 86.5 million people and supports 3.9% of global economic activity must keep this clearly in focus."
The organization also expects 69 million tons of cargo to be transported by air this year, down from the 72.5 million previously expected.
A barrel of Brent North Sea crude, the international benchmark, stands below $65 as a result of Trump's tariffs, his call to "drill baby drill," and especially a decision by OPEC+ to hike crude output quotas.
This represents an immediate boon for airlines.
Jet fuel is expected to average $86 a barrel in 2025, well below the $99 average in 2024, "accounting for 25.8% of all operating costs," IATA added.
The 2025 total fuel bill of $236 billion is $25 billion lower than in 2024.
Among the "risks" weighing on commercial aviation, IATA identified conflicts such as the war in Ukraine, as well as "trade tensions."
"Tariffs and prolonged trade wars dampen demand for air cargo and potentially travel," IATA said.
"Additionally, the uncertainty over how the Trump administration's trade policies will evolve could hold back critical business decisions that drive economic activity, and with it the demand for air cargo and business travel."
Another concern for airlines is the delay in plane deliveries.
More people are flying than ever before after a post-pandemic passenger market recovery, but airline growth is being hampered by extended plane delivery delays and supply chain bottlenecks driving up maintenance and repair time.
Walsh called predictions of aircraft delivery delays throughout this decade "off-the-chart unacceptable." He said the airline industry was evaluating legal options over the delays, but it preferred to work with manufacturers collaboratively.
"The manufacturing sector is failing badly," he said.
IATA said the number of deliveries scheduled for 2025 was 26% less than what was promised a year ago, although at 1,692, this would be the highest number of new planes since 2018.
"Further downward revisions are likely, given that supply chain issues are expected to persist in 2025 and possibly to the end of the decade," IATA said in the update to its industry outlook.
Tim Clark, president of the world's largest international airline, Dubai's Emirates, said on Sunday that the pandemic was no longer an acceptable excuse for delivery delays and challenged planemakers to take responsibility.
Similar frustration was voiced by Saudi budget carrier flyadeal.
"Delays are becoming inexcusable. Transparency, to be frank, is lacking, and we're getting agitated. How else can we plan? I mean it is just going beyond a joke now," flyadeal CEO Steven Greenway told Reuters.
U.S. planemaker Boeing is trying to stabilize and ramp up production after a quality crisis and a labour strike slowed output last year.
Last week, sources told Reuters that Europe's Airbus has been warning airlines it faces another three years of delivery delays.
Despite the challenges, carriers are still looking to purchase more planes to ensure they can meet future travel demand.
Tata Group's Air India is in talks with Airbus and Boeing for a major new aircraft order, including some 200 extra single-aisle planes, topping up a mammoth deal in 2023 as the former state carrier pursues a multi-billion-dollar revamp, Reuters reported on Sunday.
