aviation
Flying is likely to become more expensive in 2025
The airline industry is warning of rising prices, among other things because of high security check fees. But the industry also makes accusations: monopolists dictate prices.
Flying is likely to become more expensive next year. The umbrella association of airlines IATA and the Federal Association of the German Aviation Industry (BDL) expect this. The reason for this is, among other things, rising costs for wages, materials, air traffic control and security checks. Nevertheless, IATA is expecting a passenger record: for the first time, more than five billion people are expected to fly worldwide, to be precise: 5.2 billion. That would be 6.7 percent more than this year.
“Arrivals and departures in Germany are becoming significantly more expensive,” said BDL President Jens Bischof to the newspapers of the “Funke Mediengruppe”. From January, the fee cap for security checks at airports will rise from 10 to 15 euros per passenger. There is also a possibility of a significant increase in air traffic control costs, said Bischof, who is also CEO of the airline Eurowings. IATA chief economist Marie Owens Thomsen also said in Geneva that passengers would have to prepare for higher ticket prices.
Profit per passenger falls
The airlines are expecting an average of 6.4 dollars (around 6 euros) in net profit per passenger this year, significantly less than last year (7.9 dollars).
According to IATA, the net profit per passenger in Europe is lower than the global average: this year it was an average of $8.2 in Europe, $10.3 in the USA and $23.1 in the Middle East. This profit is expected to increase everywhere in 2025, in Europe to an average of $9.2 per passenger.
Increasing profits of the airline industry
For this year, the association expects a net profit of 31.5 billion dollars (29.9 billion euros). That is almost 15 percent more than in 2023. The association expects a net profit of $36.6 billion for 2025.
On the one hand, the industry has price pressure from above because it has little influence on many prices: for example airport fees and air traffic control services, but also with suppliers such as engine and machine manufacturers, some of whom exploit their monopoly position and dictate high prices, said Owens Thomsen. Strong competition creates pressure from below: every passenger can compare prices at any time and on any route, which makes price increases difficult.
Around 340 airlines from more than 120 countries are organized in IATA, including Lufthansa. They transport around 80 percent of the world’s air traffic, passengers and air freight.
dpa
Source: Stern
