Aircraft and Fuel Shortages Threaten IATA's Emission Goals, Walsh Warns

Challenges Facing IATA's Emission Goals

By Tim Hepher and Huey Mun Leong

SINGAPORE, Feb 2 (Reuters) - The head of a body representing global airlines said on Monday shortages of efficient new aircraft and alternative fuels were pushing up profits for suppliers and putting at risk the industry's flagship emissions goal.

The prolonged use of older planes and a shortfall in supplies of Sustainable Aviation Fuel (SAF) were driving up costs and delaying a transition to cleaner flying, Willie Walsh, director-general of the International Air Transport Association, said.

Supply Chain Issues

"I'm still optimistic, cautiously optimistic, that we can achieve net zero in 2050 but it's definitely becoming more challenging," Walsh told Reuters TV on the eve of the Feb 3-8 Singapore Airshow.

IATA's roughly 350 airlines adopted the target in 2021 to curb emissions that represent 2% to 3% of the global total. The effort relies heavily on the use of SAF and timely access to new planes and engines, delayed by supply chain problems.

Industry Cooperation Concerns

Asked whether IATA would stay the course at its next meeting in June, Walsh said: "It could well be the case that our member airlines will say that they can no longer commit to net zero in 2050."

So far, the influential trade body has stuck to its goal but is increasingly concerned about delays and maintenance bottlenecks for recent engines, as well as shortages of SAF.

"If I'm honest, I don't think it's got worse, but I see very little evidence of it getting better," Walsh said.

'NOT OUR PARTNERS'

Walsh said supply problems and the resulting price rises for engine parts, in particular, were expanding the gap between the tight margins of airlines and their engine or energy suppliers.

Future of Climate Commitments

"It's not sustainable...I think we are going to have to have a more serious discussion around this now," he said.

And he challenged the image of industry cooperation often portrayed at events like this week's air show, Asia's largest.

"It annoys me when I hear (engine makers) talking about partnership and partners. They're not our partners," Walsh said.

The comments on the sidelines of the Changi Aviation Summit were the latest salvo in a three-way supply dispute between airlines, engine makers and planemakers.

Engine makers rarely discuss prices but have strongly defended efforts to reflect the scale of investments needed to develop jet engines. Each drop of fuel saved generates cost and environmental benefits over decades-long aircraft service lives.

Walsh rejected a suggestion that some airlines were themselves giving less priority to climate control, given the sharp tilt away from green policies in the United States.

"The pressure may have come off a little bit in the short term in some geographies," said Walsh. "But longer term, everyone I speak to still believes that there is a challenge there, and the question is how are we going to do it?"

(Reporting by Tim Hepher and Bernadette Baum)