Willie Walsh Critiques EU SAF Mandates as 2030 Goals Falter

The International Air Transport Association (IATA) projects that global airline profits will reach approximately US$41 billion by 2026, translating to an average profit margin of 3.9% on total revenues estimated at US$1.053 trillion.

This information was revealed during the IATA Media Day, held in Geneva on December 9, 2025.

Chief Economist Marie Owens Thomsen noted that although these figures represent a notable achievement in terms of historical airline performance, airlines are still grappling with lower profit margins compared to other sectors. She highlighted a historical trend indicating that the airline industry has never managed to consistently average a 5% profit margin.

However, this overall figure conceals significant disparities across regions. Airlines in the Middle East, for instance, exhibit markedly healthier profit margins than their global counterparts. In 2025, Middle Eastern airlines reported profits of US$28.9 per passenger, nearly three times that of Europe, which recorded US$10.9 per passenger. Interestingly, European airlines overtook their North American rivals in profitability this year.

Africa, on the other hand, faces considerable challenges, with profit margins barely reaching US$1 per passenger carried. Issues such as political instability and fuel costs that are 20% higher than other regions contribute significantly to this disparity.

Willie Walsh Discusses Safety, Delays, and Sustainability

IATA’s Director General, Willie Walsh, addressed various industry concerns relating to safety, regulations, and sustainability.

On the topic of safety, Walsh expressed alarm over the frequent incidents of passengers leaving aircraft with their hand luggage during emergencies. He pledged to collaborate with relevant authorities to address this concerning behavior.

Regarding delays, Walsh identified external factors, particularly air traffic control (ATC) issues, as significant contributors. According to IATA data, ATC-related delays in Europe more than doubled from 2015 to 2024, largely attributed to France and Germany, which accounted for over half of these incidents. Walsh criticized the EU’s Directive 261, stating it fails to tackle the root problems of delays while placing additional financial strain on airlines.

SAF Mandates and Their Shortcomings

In terms of sustainability, Walsh expressed disappointment with the current state of the European Union’s Sustainable Aviation Fuel (SAF) mandates.

He emphasized that the industry is not producing sufficient SAF to meet ambitious climate goals, with initial targets now seemingly out of reach. The goal of achieving 10% SAF usage by 2030, once viewed as attainable, is now questionable.

Walsh pointed out that the issue lies not in pricing but in the availability of SAF. The lack of supply has forced airlines to reassess their commitments to SAF, which is disappointing for those aiming to minimize their environmental impact.

He further criticized taxes and fees implemented under the guise of environmental concern, asserting that these have caused economic harm without yielding significant reductions in carbon emissions. For instance, he described the UK’s Air Passenger Duty (APD) as essentially a revenue-generating measure rather than a true environmental tax.

When asked about the EU mandate aiming for 70% SAF usage by 2025, Walsh acknowledged the challenge, yet still deemed it achievable. He stressed that the production of e-SAF will be critical and advocated for a substantial increase in Europe’s renewable energy capacity to support this goal.

Owen Thomsen added that all planned e-SAF projects should begin by 2026 to align with the current mandates. However, the pace of SAF growth is slowing. Global SAF production capacity surged from 1 million tons to 1.9 million tons between 2024 and 2025, but is only projected to reach 2.4 million tons in 2026.

She noted that energy companies have been hesitant to invest in SAF due to lower returns compared to traditional oil and other renewable sources. To illustrate this, she compared SAF investment needs with the substantial funding flowing into sectors like artificial intelligence. If the US$217 billion invested in AI last year had been directed toward SAF, the airline industry’s needs would have been covered until 2036.

Owens Thomsen also mentioned the potential impact of the emerging SAF industry in China, suggesting that once Chinese producers start supplying SAF, it might trigger similar efforts elsewhere.