Key Takeaways
- Global airlines face over $11 billion in additional costs in 2025 due to supply chain issues
- Aircraft production delays force airlines to operate older, less efficient planes
- Record backlog of 17,000 aircraft prevents airlines from meeting growing passenger demand
Global airlines are projected to incur losses exceeding $11 billion in 2025 as persistent supply chain disruptions continue to delay aircraft production and parts deliveries, according to a new IATA report.
Breaking Down the $11 Billion Impact
The International Air Transport Association (IATA), in collaboration with consulting firm Oliver Wyman, revealed in their ‘Reviving the Commercial Aircraft Supply Chain’ study that supply chain bottlenecks are forcing airlines to maintain older aircraft longer, significantly increasing operational expenses.
The industry faces a record backlog of more than 17,000 commercial aircraft in 2024, up from the 2010-2019 average of 13,000. This prevents carriers from expanding fleets to match passenger demand, creating an industry-wide ripple effect.
The cost breakdown includes:
- $4.2 billion in additional fuel costs from operating less efficient aircraft
- $3.1 billion in increased maintenance expenses for ageing fleets
- $2.6 billion in higher engine leasing costs
- $1.4 billion for additional spare parts inventory
Demand Outpaces Capacity
Passenger demand grew by 10.4% in 2024, significantly outpacing the 8.7% increase in available capacity. This pushed load factors to a record 83.5%. With demand continuing to rise into 2025, the inability to add new aircraft remains a critical challenge.
“Airlines depend on a reliable supply chain to operate and grow their fleets efficiently. Now we have unprecedented waits for aircraft, engines and parts and unpredictable delivery schedules. Together these have sent costs spiralling by at least USD 11 billion for this year and limited the ability of airlines to meet consumer demand,” said Willie Walsh, IATA’s Director General.
Walsh emphasized that improving transparency and expanding access to the aftermarket for parts and services could help alleviate the strain.
Matthew Poitras, Partner at Oliver Wyman’s Transportation and Advanced Industrials practice, noted that while modern aircraft are more efficient than ever, industry collaboration is essential to restore balance.
“We see an opportunity to catalyze an improvement in supply chain performance that will benefit everyone, but this will require collective steps to reshape the structure of the aerospace industry and work together on transparency and talent,” he stated.
