IATA trims its estimates for 2014 airline industry profits by $700 million (but it’ll still be a big year)

The International Air Transport Association on Monday trimmed its profit estimates for the world’s airlines in 2014 by $700 million, the second time this year it has reined in its projections.

IATA said it expects airlines to report net income of $18 billion in 2014. Its original estimate was for a $19.7 billion profit, a number reduced to $18.7 billion when it revised its estimates in March.

In IATA’s release, director general and CEO Tony Tyler said that carriers “remain burdened with high taxes and weak profitability.”

“With a net profit margin of just 2.4 percent, airlines will retain only $5.42 per passenger carried,” Tyler said. “There is a mismatch between the value that the industry contributes to economies and the rewards that generates for those who risk their capital to finance the industry.”

Even with the pullback in estimates, the airline industry continues to grow its profits. Carriers earned $12.9 billion in 2013 and $6.1 billion in 2012.

The strongest region in 2014 is expected to be North America. IATA estimated that carriers in the U.S., Canada and elsewhere in North America will earn $9.2 billion. That’s up from the original estimate of $8.4 billion and the March revision to $8.7 billion.

“This improvement has been driven by consolidation and the contribution of ancillary revenues,” IATA said. “Load factors have risen to record levels with the passenger load factor reaching 83.7 percent  in April.”