ICAO projects 2% traffic increase for Q1 2024

The global aviation regulatory body, the International Civil Aviation Organisation (ICAO) has projected a 2 per cent increase in passenger traffic in the first quarter of 2024 compared to 2019, nothing that carriers would maintain profitability.

The group noted that demand this year is expected to rise by 3-4%, reflecting a Compound Annual Growth Rate (CAGR) of 0.5% since 2019.

ICAO credits Member States’ alignment with its pandemic guidance for air service recovery, nothing that global freight demand is predicted to dip by 2%.

ICAO Council President, Salvatore Sciachitano said, “The commitment of ICAO’s Member States to aligning their pandemic responses with the guidance developed by the ICAO Council has been crucial to the recovery of their air services.”

He noted that the implementation of ICAO’s post-pandemic guidance is now equally crucial to ensuring the resilience and sustainability of this recovery.

He reiterated that governments’ goals for air transport decarbonisation by 2050 support environmental sustainability, driven by ICAO-led initiatives for cleaner technologies and fuels.

“However, risks must be managed to sustain these positive trends. In 2023, air traffic on most routes had recovered fully. Major routes like Intra-Europe and Europe-North America surpassed 2019 levels. Asian routes lagged, except for South West Asia,” he added.

Cargo traffic in 2023 remained 3% below 2019 levels, though total operating profits matched 2019 figures, reaching $39 billion.

ICAO’s Monthly Monitor offers detailed insights for aviation stakeholders, aiding informed decision-making and strategic planning in the industry.

Meanwhile, the International Air Transport Association (IATA), the umbrella body for over 300 global airlines forecast for 2024 paints a promising picture for the aviation industry, with expectations of record airline revenue reaching $964 billion.

This projected revenue signifies a substantial rebound and resurgence for airlines, reflecting renewed vigour and vitality within the industry.

Moreover, the anticipation of 4.7 billion passengers flying in 2024, surpassing pre-pandemic levels, underscores the strength of the projected recovery and the heightened interest in air travel.

Despite the challenges faced by cargo revenue, the prediction of profitability in critical regions such as North America, Europe, and the Middle East further highlights the diverse and resilient nature of the industry’s revenue streams.

In addition to the positive outlook for airline revenues and passenger numbers, the financial projections for the aviation industry in 2024 indicate a robust recovery.

The predicted net profits of $25.7 billion, coupled with a 2.7% profit margin, underscore the industry’s resilience and capacity to navigate the economic challenges posed by the pandemic.

However, it is essential to note that factors such as jet fuel prices and oil costs are expected to influence the industry’s expenses and overall profitability, highlighting the need for strategic cost management and risk mitigation strategies.

Furthermore, the potential impact of global economic uncertainty and armed conflicts on the industry’s forecasts underscores the importance of adaptive financial planning and risk assessment.

In addition to the positive outlook for airline revenues and passenger numbers, the financial projections for the aviation industry in 2024 indicate a robust recovery. The predicted net profits of $25.7 billion, coupled with a 2.7% profit margin, underscore the industry’s resilience and capacity to navigate the economic challenges posed by the pandemic.

However, it is essential to note that factors such as jet fuel prices and oil costs are expected to influence the industry’s expenses and overall profitability, highlighting the need for strategic cost management and risk mitigation strategies.

Furthermore, the potential impact of global economic uncertainty and armed conflicts on the industry’s forecasts underscores the importance of adaptive financial planning and risk assessment.

The recovery trajectory envisioned for the aviation industry in 2024 encompasses a phased and strategic approach, with domestic travel anticipated to lead the rebound before international travel gains momentum.

Wole Shadare