The airline industry around the world grew its operating profit to about $60 billion and an operating margin of 8.0 per cent at the end of 2016.
In a preliminary report released by the International Civil Aviation Organization (ICAO), it stipulated that the operating profit rose as a result of the significant decrease in fuel cost across the globe, stressing that fuel accounted for nearly one-fifth of the industry’s operating costs in 2016 after accounting for one-third in 2015.
“This comes after an operating profit of USD 58 billion and an operating margin of 8.0 per cent in 2015. For a consecutive year, more than a third of the profits are expected to come from the carriers of North America, whose domestic market represents 66 per cent of their total operations. Improving economic conditions forecast by the World Bank will see traffic growth and air carrier profitability momentum continuing in 2017,” the organization said.
Apart from the profit made, a total of 3.7 billion passengers traveled on scheduled services during 2016.
Total departures rose to approximately 35 million globally and world passenger traffic increased by 6.3 percent to 7,015 billion scheduled revenue passenger-kilometers (RPKs), although that rate was down from 7.1 percent achieved in 2015.
“Over half of the world’s tourists who travel across international borders each year were transported by air. Despite the weak economic conditions, global passenger traffic continued to grow helped by the lower air fares owing to the fall in oil prices,” the organization reported” the report said.