The global aviation industry has reason to be cheerful. Despite a weak global economy taking a toll on cargo revenue, the industry has managed to grow its revenue at a healthy clip since the crisis-riddled period of 2009 from $476 billion to $718 bilion in 2015. But, more importantly, profitability has shown a phenomenal jump to $35 billion in 2015 against a loss of $4.6 billion in 2009, according to industry body IATA. A large part of the bottom-line improvement has come from the over 80% fall in the price of crude oil, resulting in lower aviation turbine fuel cost. Aggressive ticket pricing led to a higher jump in passengers criss-crossing the globe, helping airlines worldover to grow revenues and stay profitable. As a result, the average return on invested capital for airlines, rose above the cost of capital for the first time, at over 9% in 2015 and is expected to continue in the current year as well. With IATA predicting consumers to spend 1% of world GDP on air transport, the party in the sky seems to have just begun.
Graphically Speaking
Flight of Fancy
The global aviation industry is in full flight towards profitability after a crisis-ridden period
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Published 4 years ago on Sep 19, 2016 • 1 minute Read
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