Weekend Edition: Flying on Thin Margins
Airline analyst John Strickland downplays the prospects of a downturn in the airline industry, but says prospects are bleaker for Boeing and Airbus.
NAB Morning Call · NAB - The Morning Call
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Show Notes
Thursday 17th April 2025
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IATA is predicting the airline industry will break through the $1 trillion revenue mark, but with margins averaging up 3.6 percent. Phil suggests to airline industry analyst John Strickland that it’s not much of a return for such a capital-intensive industry subject to so much geopolitical risk. But, John argues, if you take the long-term perspective, and look for airlines with strong, proven management that have shown they can deliver margins and cope with crises, you can still enjoy healthy dividends. When it comes to the challenges of tariffs, the manufacturers face the biggest problem, with components sourced all over the globe. There’s also the rise of China’s aircraft manufacturing that is likely to break the Boeing-Airbus duopoly.
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