IATA: Supply chain crisis could cost airlines over $11 billion
Global airlines are bracing for losses exceeding $11 billion in 2025 as supply chain disruptions continue to delay the delivery of aircraft and engines, according to the International Air Transport Association (IATA), Kazinform News Agency reports.
A new joint study by IATA and consulting firm Oliver Wyman, Reviving the Commercial Aircraft Supply Chain, paints a troubling picture of an industry caught between soaring demand and production gridlock. The backlog of commercial aircraft has reached a record 17,000 units, compared to roughly 13,000 per year before the pandemic. In 2024, Airbus delivered 766 aircraft, down from 863 in 2019, while Boeing delivered only 348—barely half of its pre-crisis output. Delivery times have stretched from 4.5 to nearly 7 years.
The delays are forcing airlines to rely on older, less fuel-efficient aircraft, driving up costs across the board. IATA estimates the industry will spend an extra $4.2 billion on fuel, $3.1 billion on maintenance, $2.6 billion on engine leasing, and $1.4 billion on spare parts—pushing total additional costs beyond $11 billion.
Meanwhile, passenger demand is outpacing supply. In 2024, traffic grew by 10.4 percent, while capacity expanded by only 8.7 percent, sending global load factors to an all-time high of 83.5 percent. This imbalance is likely to persist through 2025. The report cites geopolitical instability, raw material shortages, labor gaps, and a fragile post-pandemic production model as the main culprits. It also warns that manufacturers now earn more from aftermarket services and repairs than from selling new aircraft, reducing the incentive to ramp up production.
“Airlines depend on a reliable supply chain to operate and grow efficiently,” said IATA Director General Willie Walsh. “Today we face unprecedented waits for aircraft, engines, and parts. Costs have already spiraled by at least $11 billion this year, limiting the industry’s ability to meet consumer demand. There is no simple solution, but greater transparency and access to the aftermarket would provide some relief.”
The report urges closer collaboration among airlines, manufacturers, and lessors, as well as deeper investment in digital maintenance tools and data sharing. It calls for expanded repair capacity, smarter inventory pooling, and broader use of recycled and 3D-printed components to ease bottlenecks. Workforce renewal is another key priority, with the report stressing the need to attract and train a new generation of skilled technicians.
Oliver Wyman partner Matthew Poitras noted that today’s aircraft are “larger, more advanced, and more fuel-efficient than ever,” but warned that the industry’s progress is being held back by a brittle supply chain. Recovery, he said, will depend on joint action to rebuild resilience, transparency, and talent.
IATA, representing about 350 airlines that carry over 80 percent of global air traffic, called for strategic cooperation to restore production balance and help airlines meet the world’s growing appetite for air travel.
Earlier, it was reported that families of victims of the June Air India Flight 171 crash filed a lawsuit in the United States against aircraft manufacturer Boeing and aviation systems supplier Honeywell, alleging that defective fuel switches led to the fatal accident that killed 260 people. The case renewed global scrutiny of aircraft safety and component reliability in the commercial aviation industry.