IATA has lifted its forecast for collective industry profits to $12.7 billion, at little over $2 billion up on its March forecast and a marked improvement on the $7.6 billion the industry made in 2012.
The outlook is based on revenues growing to reach $711 billion and passenger numbers growing 5% to pass the 3 billion mark for the first time. It also reflects a slight easing in the project fuel price for airlines.
In announcing the improved outlook for the sector during IATA's AGM in Cape Town, the association's director general Tony Tyler said the performance reflects the fundamental changes airlines have been making in their business. In particular he highlights "significantly increases in load factor" - which it predicts will average 80.3% this year - the first time it will top the 80% level.
He also points to the growth of ancillary revenues. He notes these have risen from $2.5 billion in 2007 - representing just a fraction of total revenues - to $36 billion this year, around 5% of revenues. "It is clear that airlines have found new ways to add value to the travel experience and to shore-up the bottom line," says Tyler.