NASSAU, BHS. – From supply chain crises to the transition to sustainable fuels, Willie Walsh , Director General of the International Air Transport Association (IATA) , outlined the challenges and opportunities facing the airline industry as the upcoming U.S. election and global mandates create an uncertain environment for airlines.
Speaking at the ALTA AGM & Airline Leaders Forum 2024 , Walsh made it clear that while there is progress on some fronts, many issues remain, requiring urgent attention and a strategic approach.
He said airlines are dealing with grounded aircraft waiting for parts needed for maintenance, which increases costs and complicates planning for future growth, creating caution in the industry, limiting the addition of new capacity and affecting aircraft reliability.
“Airlines are trapped in a cycle of uncertainty, where every delay in supply not only impacts operating costs, but also limits airlines’ ability to meet growing passenger demand,” Walsh said.
As the post-pandemic recovery continues, pressure on infrastructure and maintenance resources has led to a situation where many aircraft cannot be in service, further exacerbating the crisis.
On the other hand, the evolution of technology in the airline industry , although the improvement in engine efficiency has been notable, Walsh expressed his concern about the possibility that the technology has been pushed to the limit, thus affecting its reliability.
“Technological advancement is essential, but not at the expense of safety and operability. Airlines need confidence that engines and components will perform as expected,” he said.
Reliability problems, especially with engines, suggest the industry may have moved too quickly , which not only affects airline operations but also increases maintenance costs, which in turn impacts airfares.
Sustainable fuels: a necessary path
A central theme for Willie Walsh is the need to adopt sustainable aviation fuels (SAF) to achieve net-zero emissions commitments.
Walsh stressed that while there is a path laid out by IATA for the implementation of SAF, a concerted effort by all stakeholders is needed.
With 2025 targets looming, some airlines have begun to make voluntary commitments, but the issue of supply remains critical.
“Mandating the use of SAF without sufficient supply is a mistake. The industry has used every drop of SAF produced. The lack of production is affecting the sustainability of the industry and in turn increasing costs for airlines,” Walsh stressed.
He added that this situation could lead to higher prices for passengers, which could discourage consumers from flying , creating a vicious cycle that harms both the industry and end users.
Regulatory challenges and unequal competition
Walsh also spoke of the need for an equitable approach to global aviation regulation.
He stressed that EU regulations, which apply to intra-European aviation, could create distortions in competition, especially in the context of Russian airspace.
“The idea that some cannot use Russian airspace and therefore we restrict others is not fair. We should work to open this space for everyone, maximizing its efficient use,” he argued.
He also stressed that not all countries can move towards decarbonising aviation at the same pace, for example, countries like India, which are in the early stages of developing their airline industry , so they need an approach that allows them to grow without the same restrictions imposed on more mature markets.
“You can’t assume the world will move at the same pace. Aviation will continue to be a driver of economic growth, lifting people out of poverty and providing opportunities,” Walsh said.
He stressed that as the industry faces new challenges, there must also be a global commitment to ensure that aviation remains accessible and affordable for all.
“The reality is that the airline industry has historically been a driver of economic and social development. We must not lose sight of that fact as we navigate the complexities of sustainability and regulation,” he said.
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