IAG’s recently announced order for Boeing and Airbus widebodies is mainly aimed at replacing ageing aircraft. As such it is fairly unremarkable.
However, it also heralds another significant moment in the recovery by Europe’s three leading legacy airline groups from the COVID-19 crisis.
According to announcements given to the stock market IAG, Lufthansa and Air France-KLM all plan higher net capital expenditure (capex) in 2025 than in 2024 and 2023. In aggregate, they expect a combined figure of EUR10.0 billion, their highest ever total and 9% above the previous high in 2019.
This indicates a return to confidence after the belt tightening of the pandemic period. However, the capex cycle of the three groups is rising while the margin cycle has been on a plateau for the past three years.