Published by Global Banking & Finance Review®
Posted on June 2, 2025
4 min readLast updated: January 23, 2026
Add as preferred source on GoogleGlobal airlines face challenges from trade barriers and aircraft delays, impacting profits and growth. IATA forecasts reduced profits, while airlines strive for sustainability.
By Nandan Mandayam, Shivansh Tiwary and Rajesh Kumar Singh
NEW DELHI (Reuters) - Airlines warned on Monday that growing trade barriers risked damaging the global economy and pledged to resist efforts by manufacturers to pass on tariffs as higher prices for aircraft.
Airline bosses also complained that "unacceptable" aircraft delays were dampening growth at a time of record passenger numbers, as the International Air Transport Association shaved a key forecast for 2025 industry-wide profits.
"Like all forms of connectivity, flying makes the world more prosperous," IATA Director General Willie Walsh said at the group's annual meeting in New Delhi.
"That stands in contrast to isolationism, trade barriers and the fragmentation of the multilateral rules-based system. These destroy wealth and lower living standards. For the times we live in, this is an important message," he said.
Sweeping tariffs imposed by U.S. President Donald Trump have stoked fears of an economic slowdown and squeezed discretionary spending, prompting many consumers especially in the United States to delay or scale back travel plans.
"The consumer is uncertain," said JetBlue Airways CEO Joanna Geraghty.
IATA now expects global airlines to make a combined profit of $36.0 billion this year, down from a previous forecast of $36.6 billion in December, but up from $32.4 billion last year.
Walsh said there was no evidence so far that aircraft prices had increased due to tariffs, but that airlines would resist any attempt to charge more.
Engine maker GE Aerospace and several other aerospace groups have said they are passing on tariff costs in a surcharge.
IATA represents some 300 airlines and 80% of global traffic.
DELIVERY DELAYS
More people are flying than ever before after a post-pandemic passenger market recovery, but airline growth is being hampered by extended delivery delays and supply bottlenecks.
Walsh called predictions of aircraft delivery delays throughout this decade "off-the-chart unacceptable".
He said the airline industry was evaluating legal options over the delays, but preferred to work with manufacturers.
"The manufacturing sector is failing badly," he said.
Planemakers Airbus and Boeing had no immediate comment.
IATA said the number of deliveries scheduled for 2025 was 26% fewer than promised a year ago.
"Delays are becoming inexcusable. Transparency, to be frank, is lacking, and we're getting agitated," Airbus customer Steven Greenway, CEO of Saudi budget carrier flyadeal, told Reuters.
Last week, Reuters reported that Airbus had been warning airlines that it faces another three years of delivery delays.
Boeing is trying to stabilise and ramp up production after a quality crisis and labour strike.
Despite the challenges, airlines are still looking to purchase planes to ensure they can meet future travel demand.
India's largest carrier IndiGo announced an order for Airbus jets on Sunday and Reuters reported that Air India was looking to place another huge order after a record deal two years ago.
"Indian carriers have placed orders for more than 2,000 new jets and that's just a start," Prime Minister Narendra Modi told the IATA meeting, noting the number of Indian air passengers is expected to reach 500 million by 2030, from 240 million now.
SUSTAINABILITY
Alongside prickly relations with planemakers, airlines are at odds with energy firms over scarce supplies of sustainable aviation fuel as they seek net zero emissions by 2050.
Walsh said energy firms in Europe had added their own extra charges over the cost of complying with mandatory minimum quotas.
Industry association FuelsEurope did not immediately respond to a request for comment.
Airlines have come under fire from environmental groups for not doing enough to meet the net zero goal.
Aviation is behind where it needs to be but it is not too late to meet the target, Walsh said.
He challenged other parts of the sector, as well as governments and energy firms to turn things round by the time the industry holds its next annual pow-wow in Brazil in 2026.
IATA expects SAF production to double in 2025 to reach 2 million tonnes, but this will represent just 0.7% of airlines' fuel consumption.
(Additional reporting by Abhijith Ganapavaram, Tim Hepher, and Joanna Plucinska; Writing by Lisa Barrington; Editing by Jamie Freed and Mark Potter)
Global airlines are facing challenges from growing trade barriers and unacceptable aircraft delivery delays, which are dampening growth despite record passenger numbers.
Trade barriers, particularly tariffs imposed by the U.S., have created consumer uncertainty, leading many to delay discretionary spending, including travel.
The IATA expects global airlines to make a combined profit of $36.0 billion this year, slightly down from a previous forecast of $36.6 billion.
Airlines are evaluating legal options regarding delivery delays but prefer to work collaboratively with manufacturers to resolve the issues.
Airlines are striving for net zero emissions by 2050, but they face challenges related to the availability of sustainable aviation fuel and compliance costs.
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