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IATA–Oliver Wyman: Supply Chain Crisis to Cost Airlines Over $11 Billion in 2025

IATA says the findings could prompt fresh scrutiny of supplier competition.

The IATA logo is displayed during the annual International Air Transport Association (IATA) meeting in New Delhi, India, June 2, 2025. REUTERS/Anushree Fadnavis/File Photo

Overview

  • New analysis pegs the 2025 cost burden at more than $11 billion, including about $4.2 billion in extra fuel, $3.1 billion in additional maintenance, $2.6 billion in engine leasing and $1.4 billion in spare‑parts inventory.
  • Researchers cite labor, materials and parts shortages, prolonged engine shop visits and intensifying competition from defense work for limited capacity as key drivers.
  • A record backlog exceeding 17,000 aircraft in 2024 and lead times nearing seven years are keeping older, less efficient jets in service longer.
  • Passenger demand rose 10.4% in 2024 versus 8.7% capacity growth, pushing load factors to roughly 83.5% and constraining carriers’ ability to add seats through 2025.
  • The report urges wider access to alternative parts (PMA/USM), better end‑to‑end visibility, predictive maintenance and shared parts pools, along with expanded repair capacity and workforce investment, as IATA signals possible competition re‑examination in the aftermarket.