Supply Chain Crisis Cost Airlines USD11B in 2025, IATA Chief Warns
International Air Transport Association (IATA) Director General Willie Walsh made the disclosure at a closing press conference on the final day of IATA's Annual General Meeting in Rio de Janeiro, painting a stark picture of an industry still grappling with deep structural disruptions.
"Supply chain failures cost airlines at least $11 billion in 2025," Walsh said, warning that rising fuel prices threatened to compound the financial damage further.
The core problem, Walsh explained, stems from manufacturers failing to deliver new aircraft and engines on schedule — forcing carriers to keep aging, less fuel-efficient fleets in operation far longer than financially or operationally intended. The knock-on effects have been significant, driving up fuel consumption, inflating maintenance expenditures and pushing additional aircraft leasing costs onto already strained balance sheets.
The $11 billion figure is particularly striking when measured against the industry's projected $23 billion profit for the year — meaning supply chain dysfunction alone has eroded roughly half of what should have been a healthy earnings cycle.
Walsh was pointed in assigning responsibility, stating that a substantial portion of the losses could have been avoided had aircraft and engine manufacturers tackled their delivery and production backlogs more decisively. He noted that frustration among airline executives over the situation is both deep and widespread across the industry.
On the regulatory front, Walsh underscored the outsized global influence of European Union policymaking on aviation, noting that decisions made in Brussels routinely shape regulatory approaches in markets far beyond Europe. In response, IATA has moved to bolster its lobbying presence in the EU capital, bringing on board both policy specialists and seasoned government affairs professionals to ensure the airline industry's voice carries greater weight within EU institutions.
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