Aerospace Supply Chain Bottlenecks Continue to Constrain Airlines

Translations: L’engorgement des chaînes d’approvisionnement en aérospatiale continue de freiner les compagnies aériennes (pdf)

Las aerolíneas continúan sufriendo las consecuencias de los cuellos de botella de la cadena de suministro aeroespacial (pdf)

国际航协：供应链瓶颈继续制约航空业发展 (pdf)

(pdf) اختناقات سلاسل التوريد في قطاع الصناعات الجوية والفضائية تواصل فرض قيودها على شركات الطيران

Geneva – The International Air Transport Association (IATA) updated its analysis of aerospace supply chain bottlenecks noting that aircraft availability remains one of the most significant constraints on industry growth in its just released global outlook.

While deliveries of new aircraft began to pick up in late 2025 and production is expected to accelerate in 2026, demand is forecast to outstrip the availability of aircraft and engines. The normalization of the structural mismatch between airline requirements and production capacity is unlikely before 2031-2034 due to irreversible losses on deliveries over the past five years and a record-high order backlog.

Notable points on the current situation include:

• Delivery shortfalls now total at least 5,300 aircraft.
• The order backlog has surpassed 17,000 aircraft, a number equal to almost 60% of the active fleet. Historically, this ratio was steady at around 30-40%. This backlog is equivalent to nearly 12 years of the current production capacity.
• The average fleet age has risen to 15.1 years (12.8 years for aircraft in the passenger fleet, 19.6 years for cargo aircraft, and 14.5 years for the wide-body fleet).
• Aircraft in storage (for all reasons) exceed 5,000 aircraft, one of the highest levels in history despite the severe shortage of new aircraft.

“Airlines are feeling the impact of the aerospace supply chain challenges across their business. Higher leasing costs, reduced scheduling flexibility, delayed sustainability gains, and increased reliance on suboptimal aircraft types are the most obvious challenges. Airlines are missing opportunities to strengthen their top-line, improve their environmental performance, and serve customers. Meanwhile, travelers are seeing higher costs from the resulting tighter demand/supply conditions. No effort should be spared to accelerate solutions before the impact becomes even more acute,” said Willie Walsh, IATA’s Director General.

As production bottlenecks continue, new challenges and impacts are being revealed:

• Delivery delays are compounded by several factors, including:
  • Airframe production is outpacing engine production (which is constrained due to issues with existing engines). This is resulting in newly completed airframes being parked until engines are available.
  • Longer timelines for new aircraft certification (from 12-24 months to four or even five years) are delaying entry into production/service, particularly impacting long-haul fleet renewal.
  • Tariffs on metals and electronics resulting from US-China trade tensions have worsened some supply bottlenecks and raised some maintenance costs.
  • A shortage of skilled labor, especially in engine and component manufacturing, is constraining production ramp-up plans.
  • The fragility of the aerospace supply chain network (often reliant on a limited number of suppliers for critical parts) can become an acute constraint amid economic uncertainty, changing tariff regimes, and tight labor markets. As a result, even small disruptions can be difficult to resolve and balloon to significant production delays.
• Fuel efficiency improvements are slowing as the fleet ages. Historically, fuel efficiency improved by 2.0% per year, but this slowed to 0.3% in 2025 and is projected at 1.0% for 2026.
• The situation for the air cargo fleet risks evolving:
  • Converted aircraft from passenger operations are in short supply as airlines keep them in use for passenger operations longer.
  • New-build wide bodies face production delays.
  • Older cargo aircraft which have been kept flying longer to compensate for slower fleet renewal will eventually reach hard limits on their useful life.

A recent study by IATA and Oliver Wymann estimated that the cost to the airline industry of supply chain bottlenecks will be more than USD 11 billion in 2025, driven by four main factors:

• Excess fuel costs (~USD 4.2 billion): Airlines are operating older, less fuel-efficient aircraft because new aircraft deliveries are delayed, leading to higher fuel costs.
• Additional maintenance costs (USD 3.1 billion): The global fleet is aging, and older aircraft require more frequent and expensive maintenance.
• Increased engine leasing costs (USD 2.6 billion): Airlines need to lease more engines since engines spend longer on the ground during maintenance. Aircraft lease rates have also risen by 20–30% since 2019.
• Surplus inventory holding costs (USD 1.4 billion): Airlines are stocking more spare parts to mitigate unpredictable supply chain disruptions, increasing inventory costs.

To help expedite solutions, the study pointed to several considerations:

• Open up aftermarket best practices by supporting Maintenance, Repair and Operations (MRO) to be less dependent on OEM-driven commercial licensing models, as well as facilitating access to alternative sourcing for materials and services.
• Enhance supply chain visibility by creating clearer visibility across all supplier levels to spot risks early, reduce bottlenecks and inefficiencies, and use better data and tools to make the whole chain more resilient and reliable.
• Use data more extensively in leveraging predictive maintenance insights, pooling spare parts, and creating shared maintenance data platforms to optimize inventory and reduce downtime.
• Expand repair and parts capacity to accelerate repair approvals, support alternative parts and Used Serviceable Material (USM) solutions, and adopt advanced manufacturing to ease bottlenecks.

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