Aerospace Supply Chain Bottlenecks Hit Airlines: IATA

The aerospace supply chain bottlenecks 2025 crisis continues to constrain global airline growth, with delivery shortfalls now totaling at least 5,300 aircraft and costing carriers over $11 billion this year, according to the International Air Transport Association (IATA). The industry body warned that normalization is unlikely before 2031-2034.

IATA’s latest global outlook reveals that despite new aircraft deliveries beginning to increase in late 2025, demand significantly outstrips the availability of aircraft and engines. The order backlog has surpassed 17,000 aircraft—equivalent to nearly 60% of the active fleet, double the historical ratio of 30-40%.

Key Takeaways

Delivery shortfalls reach 5,300 aircraft with a record 17,000-aircraft backlog
Airlines face $11 billion in additional costs from fuel, maintenance, and leasing
Average fleet age rises to 15.1 years, slowing fuel efficiency gains
Supply chain normalization not expected until 2031-2034

Multiple Factors Driving Supply Chain Crisis

The aerospace supply chain bottlenecks 2025 situation stems from several compounding challenges. Airframe production is outpacing engine production, resulting in newly completed aircraft being parked until engines become available. Additionally, aircraft certification timelines have extended from 12-24 months to four or five years, particularly impacting long-haul fleet renewal.

“Airlines are feeling the impact across their business,” said Willie Walsh, IATA’s Director General. “Higher leasing costs, reduced scheduling flexibility, delayed sustainability gains and increased reliance on suboptimal aircraft types are the most obvious challenges.”

Furthermore, trade tensions between the US and China have imposed tariffs on metals and electronics, worsening bottlenecks and raising maintenance costs. A shortage of skilled labor in engine and component manufacturing is also constraining production ramp-up plans.

$11 Billion Cost Breakdown Reveals Widespread Impact

A recent IATA and Oliver Wyman study identified four main cost drivers from the aerospace supply chain bottlenecks. Excess fuel costs account for approximately $4.2 billion as airlines operate older, less fuel-efficient aircraft. Additional maintenance costs total $3.1 billion due to aging fleets requiring more frequent servicing.

Moreover, increased engine leasing costs reached $2.6 billion, with aircraft lease rates rising 20-30% since 2019. Surplus inventory holding costs added $1.4 billion as airlines stock more spare parts to mitigate unpredictable disruptions.

Fuel Efficiency Gains Slow Dramatically

The aging fleet has significantly impacted environmental performance. Historically, fuel efficiency improved by 2.0% annually, but this slowed to just 0.3% in 2025 and is projected at only 1.0% for 2026. The average fleet age has risen to 15.1 years, with passenger aircraft averaging 12.8 years and cargo aircraft reaching 19.6 years.

Therefore, airlines are missing opportunities to improve their environmental performance while travelers face higher costs from tighter supply conditions.

Air Cargo Sector Faces Additional Pressures

The air cargo fleet situation risks deteriorating further. Converted aircraft from passenger operations remain in short supply as airlines retain them for passenger services longer. Meanwhile, new-build wide-body aircraft face production delays, and older cargo aircraft kept flying to compensate will eventually reach operational limits.

Industry Proposes Solutions to Accelerate Recovery

To expedite solutions to the aerospace supply chain bottlenecks, IATA’s study recommends several measures. These include opening aftermarket best practices by reducing dependence on original equipment manufacturer licensing models and facilitating alternative sourcing.

Additionally, the industry needs enhanced supply chain visibility across all supplier levels to identify risks early. Using data more extensively through predictive maintenance insights and shared platforms could optimize inventory and reduce downtime. Finally, expanding repair and parts capacity through accelerated approvals and advanced manufacturing could ease bottlenecks.

What’s Next

With aircraft in storage exceeding 5,000 units—one of the highest levels in history—despite severe shortages, the aerospace supply chain bottlenecks represent a structural challenge rather than a temporary disruption. Production capacity currently represents nearly 12 years of backlog work, indicating prolonged pressure on airline operations and passenger costs through 2034.