Credit rating agency DBRS said this week that it expects continued growth in the global aviation industry in 2025.
It mentioned that this involves potential improvements in operating margins for airlines, driven by declining fuel prices and stabilising non-fuel costs, particularly labour.
However, the agency also highlighted ongoing uncertainties and challenges, such as geopolitical instability, aircraft capacity constraints, and an ageing fleet affecting fuel efficiency and maintenance expenses.
In its latest report, titled “2025 Outlook for Global Airlines: Growth to Continue with Margin Improvements, but Challenges Persist,” DBRS warned that delays in new aircraft deliveries could impact airlines’ expansion plans and exacerbate fleet ageing.
This delay, the agency said, may increase maintenance costs and slow efforts to reduce carbon emissions.
Geopolitical risks remain a significant concern, however. According to DBRS, any escalation of existing conflicts or the emergence of new ones in other regions could severely disrupt global air travel.
The report also notes progress towards sustainability, including the EU’s Sustainable Aviation Fuels (SAF) regulation set to take effect in 2025.
Nevertheless, challenges loom over SAF production, particularly in the United States under the Trump administration.
Moreover, profitability in North America and Europe has been affected by rising operational costs, declining passenger numbers, and supply chain issues.
Despite these headwinds, DBRS expects modest margin improvements in 2025, supported by lower fuel prices, cost stabilisation, and robust demand for air travel.
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