IATA projects airlines will earn less per passenger than Apple from iPhone covers

Economic Times
Economic Times
1d ago • 6 views
IATA projects global airlines will earn a net profit of USD 7.90 per passenger in 2026, lower than previous years and less than the profit Apple makes from selling an iPhone cover.
IATA projects airlines will earn less per passenger than Apple from iPhone covers
A What happened
The International Air Transport Association (IATA) released its 2026 outlook forecasting a global net profit of USD 41 billion for airlines, equating to just USD 7.90 per passenger. This figure is unchanged from 2025 and below the 2023 profit of USD 8.50. IATA Director General Willie Walsh highlighted that Apple generates more profit selling an iPhone cover than airlines do per passenger, underscoring the thin profit margins that persist in the aviation sector despite its crucial economic role supporting 4% of global GDP and 87 million jobs. Walsh also noted profitability disparities within the air transport value chain, with suppliers and manufacturers earning substantially higher margins. Contributing factors include supply chain difficulties, delays in aircraft deliveries, geopolitical uncertainties, and minimal expected fuel efficiency gains of 1%, leading to an aging global fleet with an average aircraft age surpassing 15 years. These challenges collectively maintain the airline industry's tight profit conditions.
★

Key insights

  • 1

    Profit Margins Comparison: IATA's 2026 projections show airlines will earn only USD 7.90 profit per passenger, which is less than the profit Apple makes selling an iPhone cover, highlighting aviation's low profitability.

  • 2

    Economic Role vs. Profitability: Despite thin margins, airlines support nearly 4% of the global economy and 87 million jobs, indicating their critical role despite financial constraints.

  • 3

    Industry Challenges: Ongoing supply chain issues, aircraft delivery delays, geopolitical risks, and minimal fuel efficiency improvements impede airline profitability and fleet renewal.

Takeaways

The airline industry continues to operate under tight profit margins despite its vital economic contribution, with external challenges and internal value chain imbalances limiting its financial growth prospects into 2026.

Topics

Business & Markets Markets Economy