Aerospace supply chain: $11 billion in additional costs by 2025

The International Air Transport Association (IATA), in partnership with consulting firm Oliver Wyman (a subsidiary of Marsh McLennan), today unveiled a joint study entitled "Reviving the Commercial Aircraft Supply Chain ." The report highlights the major challenges facing the aerospace industry's supply chain, analyzing their root causes, their impact on airlines, and proposing ways to strengthen the sector's resilience.

Record delays and explosive costs

Ongoing disruptions in the aerospace supply chain are slowing the production of new aircraft and spare parts, forcing airlines to extend the use of older aircraft. By 2024, order backlogs reached a historic high of 17,000 aircraft , compared to an average of 13,000 per year between 2010 and 2019.

According to the study, these malfunctions are expected to cost the industry more than $11 billion

• $4.2 billion in additional fuel costs, linked to operating less efficient aircraft;
• $3.1 billion in increased maintenance costs for an aging fleet;
• $2.6 billion increase in engine and aircraft leases;
• $1.4 billion in spare parts inventory management.

Strongly growing demand, insufficient supply

In 2024, passenger traffic grew by 10.4% , outpacing capacity growth (+8.7%), pushing the flight occupancy rate to a record 83.5% . Despite this sustained demand, airlines are struggling to deploy enough aircraft due to delivery delays and parts shortages.

The structural causes of the crisis

The report identifies several aggravating factors:

• A rigid economic model in aerospace;
• Geopolitical instability and its impact on supply chains;
• The shortage of raw materials and skilled labor.

Collaborative solutions for a more resilient industry

For Willie Walsh, IATA Director General, "Airlines need a reliable supply chain to operate and grow their fleets. Unprecedented delays and unpredictable deliveries have already cost $11 billion this year, limiting our ability to meet demand ." The study suggests four areas for action:

1. Open the aftermarket : reduce dependence on OEM licenses and diversify sources of parts and services.
2. Improve transparency : strengthen visibility across the entire chain to anticipate risks and reduce bottlenecks.
3. Leverage data : use predictive maintenance and pool inventory to optimize resources.
4. Develop repair capabilities : accelerate repair approvals and adopt alternative materials.

Matthew Poitras, partner at Oliver Wyman, points out that "the current fleet is larger and more efficient than ever, but supply chain issues are weighing on airlines and manufacturers. Collective improvement is possible, provided we rethink the structure of the industry .

A call for collective action

The study emphasizes the need for a unified strategic approach among all stakeholders in the supply chain. “Collaboration is essential to align supply and demand and build a more resilient industry ,” the report concludes.

About IATA The International Air Transport Association (IATA) represents 300 airlines, representing 83% of global air traffic.

About Oliver Wyman Oliver Wyman is a leading global management consultancy specializing in the transportation and manufacturing sectors.