The powerful and constant offensive of the promoters of ecology has acted as a scarecrow on air transport, which, very unjustly attacked, has sought solutions, even if it means profoundly modifying certain aspects of this activity, such as, for example, stopping the reduction in fares. All the measures taken are not without interest because the more this sector of activity meets the criteria of good ecological conduct, the more profitable it will be. However, this requires colossal investments that will only have their full effect in the very long term, while being financed in the short term. We will not be spared from price increases to finance such complex research. But the constraints suffered by operators are only very gradually noticeable. Another factor is much more penalizing: geopolitics.

It has just been remembered since the extension of the conflict to the Middle East. Suddenly, air traffic in the region was brought to an almost complete standstill. It must be said that civilian aircraft can be prime targets when they are unable to defend themselves, and airports are important infrastructures, perfectly located, and that it only takes a single impact, even in a car park, to bring them to a standstill.

This is what happened with strikes, admittedly limited, but which hit the airports of Dubai, Doha, or Oman, to mention only the main ones. Dubai and Doha are huge hubs. They are home to the two main “hubs” in the region and among the most important in the world. So the shutdown of their exploitation has not only local and regional consequences, but also global ones. And they are difficult to replace because their efficiency is created by a conjunction between fixed equipment on the ground and two very large operators, Qatar Airways and Emirates. And these two companies operate on the entire planet.

But the consequences don’t stop there. The closure of the Strait of Hormuz immediately led to an increase in the price of oil, which has risen by 59% since December 16, when it was quoted at $58.64 per barrel, while on March 6 it rose to $93.04. This is not going to do business for air transport anywhere in the world, even if many companies have already secured their supplies, at least for the year.

And then there are the insurances. Air transport is largely covered by a battery of insurance contracts that range from the manufacture of planes to the loss of luggage. However, some events are not covered, in particular the case of weather hazards, but also armed conflicts. So customers who thought they were protected by their travel insurance are discovering that they have to fend for themselves.

And it’s not over. The rights to fly over territories depend on the will of each state, which can prohibit access at will. This is the decision of Russia, in particular, which, in response to the embargo imposed on it by the so-called Western countries, has banned all airlines from these countries from flying over it. However, Russia has the largest airspace in the world, and all flights between Europe and East Asia must fly over Siberia, and if the overflight is impossible, then it is necessary to pass through the south of the Asian continent, which extends the flight time by more than 2 hours in each direction, and each hour of flight of a long-haul aircraft such as the Boeing 777 or the Airbus A350 costs around 30,000 dollars. For a round trip, the additional cost is therefore $120,000 for Western carriers, while Chinese operators can fly freely over Russia. However, since the conflagration in the Middle East, the entire area has been declared a war zone, and it can no longer be used by carriers. You then have to go around the Arabian Peninsula to get to Asia.

It is easy to see how a conflict, even a very localized one, can have harmful consequences on the entire air transport activity. I also do not forget that the supply of spare parts and the entire widely dispersed aircraft manufacturing complex may also be affected by increases in customs duties.

Basically, we can only admire the resilience of air transport, which, even in the face of all these difficulties, nevertheless continues to grow steadily. Must the inhabitants of our planet have a furious need to travel? And that’s good.

The financial results for 2025 are coming in, and they give a good idea of how the sector is evolving.

European airlines have been doing well over the past year, while the American giants are still struggling somewhat. All in all, 2025 will not have been such a bad year, helped by an average oil price that remained reasonable at around $67 per barrel. Remember that in 2010, analysts expected it to reach $200. This shows that making forecasts, especially in the long term, remains a perilous exercise.

The American giants are showing some signs of weakness. Delta Air Lines’ net profit is down 5% to $3.8 billion. United Airlines’ is reportedly up 6%. However, American Airlines saw its net profit collapse by 87% to just $111 million, on revenue of $54 billion, double that of the Air France KLM group. The latter achieved a real performance by turning all its indicators green, with a net profit of €1.754 billion compared to €489 million the previous year. Its financial indicators, from equity to cash flow, are all improving. The only downside is that its low cost subsidiary Transavia France is still unable to make a profit, and its unit costs remain high for this sector at €6.73 per seat kilometre offered, compared to revenue of €6.64. The Lufthansa Group also achieved a good result, with a 32% increase in profit to €1.93 billion. Only the IAG group saw its profit fall, by 2.3%, to €1.4 billion.

The full results for the sector are not yet known because Gulf carriers and some Asian and African airlines close their accounts on March 31. Nevertheless, the outlook appears favourable.

The fact remains that many hazards can impact air transport activity, and they rarely move in the right direction. In 2025 alone, the shutdown in the USA certainly weighed heavily on the results of the major American carriers, as it occurred during the end of year holiday period. In addition, current or planned conflicts are seriously complicating operations. This is the case for European carriers, which are seeing flight times extended by around two hours on services to Asia following the ban on flying over Siberia and due to the situation in Iran, while Asian carriers do not face the same disadvantages. Furthermore, the thunderous announcements of the American President are at the very least disrupting short and medium term operating plans.

But amid these difficulties, to which one could add the impact of ecological constraints that have heavily penalised companies such as KLM, there are also some grounds for satisfaction.

First, and hopefully soon, the reopening of connections to Venezuela, a large country and an important destination for economic, touristic and family reasons. This will give a boost to South American services, which are in real need of it.

And then the airlines have taken a historic turn. Instead of continuing, as they have done for more than 30 years, to pursue fare reductions, which were often accompanied by a decline in product quality through reduced services and excessive cabin densification, we are now witnessing an improvement in product quality. In fact, the inflection point came with Covid. As soon as this disastrous pandemic ended, operators raised their prices and realised that this did not lead to a decline in demand. They might have suspected this earlier, but better late than never. The momentum has now taken hold. European airlines in particular have all decided to enhance their products. The most spectacular example can be seen at Air France KLM, which, it must be said, had fallen very low. Its policy of upgrading its offering appears beneficial, judging by the significant improvement in its financial results. Customers are willing to pay more for a better product. This is not new, and it is encouraging that airline executives have recognised it.

If this strategy continues, and if geopolitical conditions do not deteriorate during 2026, we can expect a further improvement in results that will make air transport the leading sector in the world, for the good of all.

The 5 billion passenger mark will have been passed in 2026. To reach this exceptional level, no fewer than 28,000 aircraft will be needed in service to serve just over 4,000 airports around the world. This volume of traffic is starting to cause serious problems. First of all, sufficient airspace is required, especially in very dense areas such as the United States and Europe. Secondly, it must be acknowledged that air transport is a source of CO2 emissions, even if it represents less than 3% of total emissions. Finally, we must take into account the attitude of populations living near major airports, who find it increasingly difficult to tolerate aircraft flying overhead, even if they are becoming quieter and quieter.

The outlook shows that the management of this activity will be complex over the next 20 years or so. Continued growth of around 4% to 5% per year is expected, which corresponds to carrying 250 million additional passengers each year and putting 1,400 new aircraft into service annually. The challenge is significant, as it is necessary to take into account not only aspects related to safety and security, but also the ever increasing demands of consumers who are less tolerant of delays, lost luggage, or lack of comfort, while at the same time demanding ever lower fares.

We are not far from a dead end. How can we ensure continued demand for air transport while respecting environmental constraints and consumer expectations? Governments will certainly continue to levy taxes, if only to satisfy environmental lobbies and fill their coffers, while imposing compensatory obligations on companies for operational hazards they must endure. How can this squaring of the circle be resolved? It will certainly be necessary to carry more passengers with fewer aircraft, at least through the use of larger, less congested airports.

A first response is provided by the entry into service of a new generation of aircraft derived from widely used models such as the Boeing 737 or the Airbus A320. These are long range versions with lower capacity than the aircraft used until now, which are only profitable when operated on very large routes, feeding major airports that are already difficult to manage given environmental pressures. This new generation, symbolised by the A321XLR with a capacity of 200 passengers and a range of 8,700 km, will be capable of operating profitably on medium demand routes that until now have been consolidated through major hubs, as well as on routes as significant as transatlantic or US coast to coast flights.

But this will not be enough to relieve congestion at major airports. One option is to create gigantic platforms such as Dubai World Central or Al Maktoum International, built to handle 250 million passengers, as well as the new airports in Beijing or Istanbul, which are slightly smaller but nevertheless larger than most older hubs, with capacities exceeding 120 million passengers. However, these large complexes will have to be built far from urban areas, if only to secure the necessary land, such as the 140 km2 required for Dubai World Central. By comparison, the surface area of Paris is 105 km2. It will therefore be necessary to create substantial new ground transport links, which will further impact the environment.

There is another solution, which would be to return very large aircraft such as the B747 or the A380 to service after their withdrawal following Covid. They alone are capable of carrying between 600 and 800 passengers, effectively replacing four aircraft with an average capacity of 200 seats. Of course, these aircraft had supposedly become too expensive to operate. However, in recent years the oil shortage predicted in the 2010s, when a barrel was priced at 125 dollars, has been replaced by relative abundance, with prices falling to around 67 dollars per barrel at recent quotations. As a result, most operators have returned their A380s to service. Not only Emirates, which has always believed in this type of aircraft and whose Sir Tim Clark has been calling for an improved version from Airbus, but also British Airways, Singapore Airlines, Qantas, Qatar Airways, Etihad Airways and even Lufthansa. Only Air France has not taken this step.

And then, to accommodate the additional 4 to 5 billion passengers expected between now and 2040, it will be necessary to design an aircraft capable of carrying between 800 and 1,000 passengers, not over very long distances but on flights of four to five hours, which are likely to multiply.

I hope that manufacturers already have such aircraft on their drawing boards and that the current major airports will be ready to accommodate them.

The tug-of-war has begun between Ryanair and the European states. The latter, seeing the steady growth in air passenger flows, and thinking they were giving assurances to ecologists, have all taken the path of taxing airlines. In their eyes, this has a double effect: firstly, to slow down traffic volumes, in particular aircraft movements, which are sources of pollution targeted by some voters, and above all to bring money into the public coffers, which badly need it. Taxing passengers is well regarded electorally because they are still in the minority compared to other voters, so why deprive oneself of a source of income that does not seem about to dry up.

But things are not that simple. First of all, the new taxes that companies will have to pay will be fully passed on to consumers, and they are seriously starting to complain. And the transporters have a ready-made solution: since the states do not like them, they simply leave. This is exactly what low-cost airlines are doing. The latter have played an essential role in maintaining the economies of regions neglected by industrial development. Their economies have transformed from manufacturing to services and tourism. And the “low costs” have found themselves in a position of strength in these areas because they have the only model that allows them to bring in consumers to replace declining populations.

Basically, these new entrants play a real role in regional development. So they are beginning not only to threaten to withdraw, but also to take action. This is what is happening in the countries of southern Europe. This is not necessarily going to suit governments. Indeed, the volume of expected levies is likely to be much lower than expected, as the adage “Too much tax kills taxes” appears to be confirmed. In addition, this withdrawal risks leading to a considerable loss for the tourist regions that live off the contribution of these operators’ customers.

On the other hand, these same airlines, encouraged by continued growth and an efficient business model, have ordered a considerable number of new aircraft from the major manufacturers. The only five largest European “low-cost” operators, Ryanair, easyJet, Wizz Air, Vueling and Pegasus, have 1,354 aircraft and 983 on order. Opposite them, the three major groups, Lufthansa Group, Air France/KLM and IAG, certainly have 2,065 aircraft, but only 425 on order. However, all “low-cost” aircraft are short-to-medium-haul, while those of the major traditional operators are mainly used for long-haul flights. That is to say that the “low cost” carriers now hold power over European services, and this will probably be strengthened in the future.

Admittedly, geographically speaking, Europe is a small continent on which surface routes can become fierce competitors to air transport. High-speed rail lines have become very important, and the coaches of large private operators are crisscrossing the motorways and offering fares that even the most efficient “low-cost” operators cannot bear. Does this mean that European states will be able to do without their services if they decide to close ports of call, as they intend to do if governments do not reverse their taxation decisions? This is something that deserves reflection.

The balance of power between the public authorities and the airline operators is fairly even, and governments have no interest in seeing the very serious network of air services, patiently built up by the “low-cost” operators, shrink. The construction of a new motorway or a new high-speed railway is now facing fierce opposition from environmentalists, who will soon no longer have air transport to sink their teeth into. Admittedly, some air operators such as Ryanair have sometimes shown reprehensible behaviour, which is sanctioned by the courts in many countries. They will also have to improve both their social relations and their links with customers. They will have to comply with the compensation rules imposed by the European authorities. But for all that, states must not consider them enemies.

It is time for governments and operators to learn to talk to each other to provide the best service to the population.

Very interesting to follow Southwest Airlines’ earnings. It is the benchmark airline in the world of “low cost.” It was both the first to enter this field in 1971, with a huge expansion during the liberalization of the American skies in 1978, and it is also the largest in terms of turnover: $27.5 billion, even if the European Ryanair carries more passengers.

The fundamentals of the model are based on a few intangible principles: a single type of aircraft, faster turnarounds, densified aircraft capacity, no subcontracted distribution, very low call prices, a very stripped-down product with all services paid, all served by a young, enthusiastic, and sufficiently well-paid staff.

With this model, Southwest Airlines has been at the top of American domestic carriers with remarkable results. And then time did its work. Staff aged, became less efficient, and demanded and obtained benefits that were ultimately comparable to those of traditional carriers. The results paid the price. Not that the company lost money, but profits fell and, more seriously, the stock price began to decline with great regularity, which did not suit shareholders, especially investment funds. They demanded a change in management, and the latter adopted a very different strategy.

In fact, the new managers have evolved the pure “low cost” model toward a hybrid system. To begin with, distribution was extended to travel agents via GDSs; then the company entered into interline agreements, which had never been seen before. The product has improved and costs, as a result, have also increased. In total, the results were also badly affected, with a drop of 42%. And surprisingly, the stock price has soared more than 70% from its low, and the company is valued at 46 times expected earnings. Compared to Air France/KLM’s results, this would value the group at $16.3 billion instead of the current $3.63 billion, and let’s not even talk about Emirates Airlines, whose valuation on this basis would exceed $230 billion.

In other words, the stock market, which anticipates future results, has full confidence in the change in strategy of “low cost” carriers, whose product will gradually move closer to that of traditional airlines, which have gone the opposite way. Admittedly, after reaching the bottom just before Covid, the revenues of incumbent airlines are tending to rise. This was necessary because, even if their product was degraded, operational costs continued to increase, and customers no longer hesitated to leave for competitors who clearly displayed the simplest service.

It is therefore easy to imagine that the American example will be followed, albeit with some delay, by European and then Asian carriers. We are also starting to see the European leader Ryanair no longer hesitate to cancel services as soon as their profitability is no longer assured. EasyJet is taking the same path. This is how many small European airports will lose what kept them alive, as “low cost” operators have taken advantage of tax increases, decided somewhat lightly by government authorities, as a pretext to reduce their sails.

It is necessary to emphasize once again the lack of understanding in government policies which, in order to please a certain electoral clientele who will not be grateful to them, have consisted of taxing air transport in favor of railways, even going so far as to eliminate access to planes by administrative means, as we have seen in several European countries.

Meanwhile, orders for new aircraft, admittedly less polluting and more efficient, have multiplied. More than 16,000 aircraft are expected in the coming years, not counting new orders that continue to pour in.

Where are we going to put them if governments reduce access to major airports and if regional services can no longer be profitable because they are too heavily taxed? How will air transport, with its “low cost” components, be able to continue its beneficial role for the global economy and for bringing people closer together?

The next competition will no longer be in in-flight service, or even in fares, which we can expect will gradually be displayed more rationally than in the past, but will be played out in airports. The latter have become the main obstacle to air transport, which is poorly suited to the necessary fluidity of traffic, because if “low cost” carriers abandon small airports, there is no doubt they will strengthen their offer on the major platforms.