5.2 billion air travellers expected globally in 2026, passenger loads to reach all-time high: IATA

GENEVA – The number of air travellers across the globe is expected to reach 5.2 billion in 2026, while airlines are projected to fill more seats, said the International Air Transport Association (IATA) on Dec 9.

The 5.2 billion passengers forecast to take to the skies in 2026 represent a 4.4 per cent increase from the 4.99 billion air travellers projected for 2025, the airline industry body said at its global media day in Geneva, Switzerland.

IATA had said in June that the forecast was below the previous projection of 5.22 billion passengers for 2025, but it will still be a record high.

The average return airfare is projected to rise slightly to US$402 (S$520) in 2026, from the estimated US$400 in 2025, said IATA.

This 2026 figure is 36.8 per cent lower than 2015 levels, compared with 2025’s 34.7 per cent drop from the same levels, because of efficiency gains and competition.

Airlines are expected to fill a record high of 83.8 per cent of all seats in the coming year, on the back of a shortage of new aircraft.

In the Asia-Pacific – the largest market globally – passenger load factors are projected to reach an all-time high of 84.4 per cent despite a slower recovery in international traffic, said IATA at the yearly briefing in its Geneva office attended by more than 100 journalists from around the world.

The association represents about 360 airlines – including home-grown carriers Singapore Airlines and Scoot – that account for more than 80 per cent of global air traffic.

Demand in the Asia-Pacific will continue to be robust in the coming year. It is forecast to rise by 7.3 per cent, in part due to the easing of visa requirements for Chinese group tours to South Korea, as well as visitors to China. This is expected to stimulate short-term inbound demand – particularly during peak holiday periods.

However, IATA noted that restrictions on flights between the United States and China continue to limit market access, with scheduled services currently set at about 100 round-trip flights a week, down from over 150 before 2020.

Meanwhile, airlines’ revenue from ticketing is expected to rise to US$751 billion in 2026, up 4.8 per cent from US$716 billion in 2025.

The growth will be mainly driven by a 4.9 per cent increase in passenger demand, which is measured by revenue passenger kilometres, or the volume carried by airlines.

On the whole, the industry is projected to rake in a net profit of US$41 billion in 2026, up from US$39.5 billion in 2025, with a net profit margin of 3.9 per cent.

This is “extremely welcome news”, considering the headwinds facing the industry, such as rising costs from bottlenecks in the aerospace supply chain and geopolitical conflict, said IATA director-general Willie Walsh.

Total revenues across the airline industry are expected to reach US$1.05 trillion, outpacing growth in operating expenses and rising 4.5 per cent from the US$1.008 trillion expected in 2025.

But Mr Walsh noted that collectively, the airline industry does not generate earnings that cover its cost of capital, which “remains an issue to be resolved”.

The average net profit from every passenger flown is expected to come in at US$7.90 in 2026, below the high of US$8.50 in 2023.

“Industry-level margins are still a pittance, considering the value that airlines create by connecting people and economies,” he said.

“Imagine the additional power that airlines could bring to economies if we could rebalance value chain profitability, reduce regulatory and tax burdens, and alleviate infrastructure inefficiencies.”

The costs to be borne by airlines are expected to be more balanced in 2026, with the inflation slowdown helping to stabilise costs, IATA said.

Fuel costs are forecast to decline slightly, by 0.3 per cent to US$252 billion, with crude oil and jet fuel prices expected to see a decline.

But fuel efficiency gains are expected to be only 1 per cent, as supply chain challenges continue to hold back the renewal of fleets and push the average aircraft age to more than 15 years – the highest to date.

Fuel consumption is projected to rise 2.7 per cent to 106 billion gallons in 2026.

Airlines are expected to spend US$4.5 billion on green aviation fuels in 2026, with an expected 2.4 million tonnes to be produced, forming a mere 0.8 per cent of total fuel consumption.

In 2025, 1.9 million tonnes of such fuel are expected to be produced, slightly down from the initial forecast of 2 million tonnes.

The aim is for international aviation to be 5 per cent less carbon-intensive by 2030 through the use of such fuel. IATA has said green aviation fuel could contribute around 65 per cent of the reduction in emissions needed by aviation to reach net zero in 2050.

Sustainable aviation fuel (SAF) – made from waste materials such as used cooking oil and animal fat – can cost two to five times more than traditional jet fuel.

Mr Walsh, on Dec 9, said it would be challenging for the industry to reach the 2030 target, as SAF production levels have been disappointing.

“It is not an issue of price. It is an issue of availability, and (airlines) are just not able to get their hands on the SAF required to fulfil the ambition,” he said.

IATA said the backlog in aircraft orders is expected to grow in 2026, despite a projected increase in aircraft deliveries. This will place a continued drag on the profitability of airlines.

The order backlog has surpassed 17,000 aircraft in 2025, which is equivalent to about 60 per cent of the active fleet. Delivery shortfalls have exceeded 5,000 aircraft.

It warned that the pace of new orders is outstripping production, causing the backlog to reach new highs and signalling that supply constraints and their financial impact will persist “well beyond the near term”.

Mr Walsh noted that the slow production is estimated to cost the airline industry more than US$11 billion in 2025, in part due to increased fuel burn and extra maintenance costs from flying older, less fuel-efficient aircraft.

He criticised key suppliers for making “massive margins” of more than 20 per cent on aircraft equipment and engine leasing costs, imposing additional costs on the airline industry. This is “unacceptable, and it has got to stop”, said Mr Walsh.

IATA is looking at legal avenues to tackle this issue, he added.