Airlines Brace for Prolonged Supply Chain Turbulence

The airline industry faces persistent supply chain disruptions likely lasting up to eight years, driven by a delivery shortfall of over 5,300 aircraft. Legal actions are being considered as costs mount, and a backlog of 17,000 aircraft orders exists. Solutions may not normalize before 2031 due to ongoing challenges.

The aviation sector is confronting prolonged supply chain disturbances expected to extend for as long as eight years, with a substantial delivery deficit of more than 5,300 aircraft already evident. The International Air Transport Association (IATA) reports escalating costs for airlines, prompting some to explore legal avenues to address these enduring challenges.

Willie Walsh, IATA's Director General, highlighted the stark contrast between engine manufacturers' substantial profits and airlines' slim margins. He indicated that if an airline places an aircraft order today, they face an average wait of 6.8 years for delivery. This extended timeline exacerbates the existing backlog of over 17,000 aircraft orders.

Despite a recovery in aircraft deliveries expected in late 2025 and an uptick in production by 2026, the demand vastly exceeds supply. IATA warns that the mismatch between airline needs and production capacity may persist until at least 2031. Delivery backlogs, manufacturing issues, and geopolitical tensions continue to complicate recovery efforts and inflate costs.

(With inputs from agencies.)