Regionally, North American airlines should perform best in 2018, and are forecast to generate net profits of $16.4 billion (up from $15.6 billion in 2017). A strong upcycle in the cargo markets will also support the expected profit improvement next year, it added.
Traffic demand worldwide, as measured in RPKs, has increased 7.7% year-to-date, exceeding the 10-year average pace of 5.5% growth, IATA said.
Global air passenger traffic grew 7.2% year-over-year (YOY) in October, largely recovering from the weather-related slowdown seen in September, according to IATA's October Air Passenger Market Analysis.
Ryanair, whose chief executive is Michael O'Leary, pictured, carried 128.7m passengers in the 12 months to the end of November, an 11pc increase on the previous 12-month period.
While cargo demand remains strong, several indicators show that we may have passed the growth peak.
That said, IATA expects passenger load factor to remain comfortably above the breakeven point for airlines globally going into 2018, despite earnings before interest and tax (EBIT) coming under pressure from higher costs.
US Trade Deficit Widens More Than Expected In October
In October, the United States ran a surplus of $20.3 billion with the rest of the world in services such as banking and tourism. Imports of crude oil shot up by USD1.5 billion, while imports of consumer goods and other goods also showed notable increases.
IATA previously said in its first half forecast that a ban on large electronics on some regional flights to the USA was taking its toll on some key routes.
For the first time, more than four billion passengers will be travelling this year, according to the aviation watchdog, and that number is expected to go up to 4.3 billion next year. Asia-Pacific carriers are projected to earn $9 billion, Latin American airlines $900 million, and Middle Eastern carriers $600 million.
Passenger numbers are expected to increase 6 per cent to 4.3 billion next year, down from 7.5 per cent this year but ahead of the 10-20 year average of 5.5 per cent. Capacity climbed 9.1%, and load factor slipped 0.3 percentage points to 82.6%.
For cargo volume, the strong growth seen in 2017 was due to unexpectedly strong demand that pushed companies to restock inventories quickly, IATA said.
The organisation forecast profit would grow to $600m next year from $300m this year on the back of a minor increase in demand.
Projecting these figures into the future, IATA predicted that China will be the largest aviation market in the world by 2025, with the US in second position and India in third.