The aviation industry is built on a complex tapestry of globally interconnected nodes. Aircraft manufacturers and maintenance service providers rely on sourcing parts and materials from all around the world, making the industry as a whole susceptible to global trends.
US President Donald Trump’s trending radical trade policies have disrupted this fine balance and will continue to affect different segments of the industry negatively — an impact that will be felt both within the borders of the US as well as across the globe. And the African airline industry could be the biggest loser.
From increased manufacturing costs for Boeing to potential price hikes on airline tickets, these tariffs are reshaping the economics of air travel. But just how significant will the effect be, and what does it mean for passengers?
Aluminium and steel costs hit Boeing hard
At the heart of the issue lies the cost of raw materials, particularly aluminium and steel, which are indispensable to the aircraft manufacturing process.
Based on the latest authoritative data from the US Geological Survey, Canada supplied about 52% of the US’s aluminium imports between 2019 and 2022. This data is hugely significant, highlighting Canada’s pivotal role in the US aluminium supply chain.
This data set becomes even more significant when considering Boeing’s most-produced aircraft, the 737 family, which are made up of an overwhelming 80% aluminium. Within this family Boeing's 737 MAX series has become all-important, now making up 70% of Boeing’s monthly deliveries.
In addition, the 737 is composed of between 11%-13% steel, which is about the same steel percentage makeup of all of Boeing’s other top sellers, including the 787 family and yet-to-be-completed 777X.
These figures underscore the profound effect Trump’s tariff war will have on Boeing’s manufacturing operations and, consequently, the entire industry. With 25% tariffs on all steel and aluminium imports, production costs will soar.
International suppliers face ripple effects
Boeing depends on a vast supply chain of international vendors and manufacturers. For instance, French-based Safran Landing Systems, the world’s largest producer of aircraft landing gear, supplies critical components, while fuselage parts are manufactured in countries such as the UK, Italy and Japan. In total, more than 20 countries contribute to the production of the Boeing 737. Boeing CEO Kelly Ortberg shared his concerns in an address to company employees, saying it will be challenging to keep prices competitive due to the inevitable supply chain disruptions.
Ireland’s AerCap, the world’s largest aviation leasing company, boasting a staggering portfolio consisting of over 2,000 aircraft and helicopters, with further orders of nearly 400 additional aircraft (as of March 14), have expressed their concerns about the effects of the tariffs. AerCap CEO Aengus Kelly stated that if the EU retaliates with tariffs of their own, Boeing products such as the highly popular 787 Dreamliner could cost upwards of $40m more.
Many other industry heavyweights have also voiced their worries about what the tariffs could mean. Airbus CEO Guillaume Faury has suggested that the company may shift aircraft deliveries away from US customers if tariffs on steel and aluminium imports start to impact its operations.
In a conversation with CNBC, Faury commented on Airbus’ strong demand from other regions and how it could adjust its delivery schedules to prioritise non-US customers. “We have substantial demand worldwide, so if delivering to the US becomes significantly challenging, we can adapt by accelerating deliveries to other eager customers.”
There are no winners in a trade war across any industry, and the airline industry is no exception. Production costs are increasing for both Boeing and Airbus, which hold a 100% market share duopoly on wide-body aircraft. All airlines will feel the pinch as a result.
Airlines and passengers will feel the pinch
Since airlines operate on extremely thin profit margins, just 3.6% globally according to the International Air Transport Association (Iata), they have little ability to absorb these additional costs.
Instead, they will likely pass them on to passengers in the form of higher ticket prices, added fees or reduced services. Then there is another indirect effect, namely the potential delay in fleet modernisation. And if airlines postpone purchasing newer, fuel-efficient planes due to higher costs, they will have to continue operating older aircraft, which consume more fuel, the cost of which could also be redirected to passengers.
The overall effect on travellers could manifest itself in several ways. Domestic flights, particularly in the US, may see noticeable price increases, while international travel could also become more expensive given that budget airlines rely on cost efficiency and may be forced to raise baggage fees or introduce new surcharges to offset rising expenses. With profit margins already razor-thin, even small cost increases could meaningfully reshape airfare pricing, which will make travel less affordable for many passengers.
Africa poised to suffer most
An economic shift as serious as the introduction of Trump’s tariffs will no doubt touch every corner of the globe, but Africa looks to be the region that will be hit hardest. The Iata financial forecasts for 2025 show the global net profit for the industry being $36.6bn. Of that total, Africa is set to contribute a measly $200m. Furthermore, Africa’s profit margin forecast for the year is just 0.9% compared to the global 3.6%.
— Ultimately, customers will bear the brunt of these rocketing expenses, potentially making air travel even less accessible than it is already across the continent.
This narrow margin leaves African airlines vulnerable to even minor fluctuations in operating costs, which could prove disastrous for many carriers. Rising aircraft purchase prices, increasing maintenance fees and unsteady fuel costs will further strain the already fragile financial standing of African airlines.
Ultimately, customers will bear the brunt of these rocketing expenses, potentially making air travel even less accessible than it is already across the continent. Africa already has the most expensive airfares in the world, but a hike in operating costs will not just mean even more exorbitant ticket prices, airlines may also resort to cutting lesser-performing routes, which will further strain the interconnectivity within Africa.
Trump’s tariffs are set to be far-reaching, with negative consequences for not only the airline industry but also for those who need to use it. The rise in aircraft purchase and maintenance prices as well as airfares could spell disaster for both the airlines and passengers alike, making the whole business simply unaffordable.
• Gumede is an aviation analyst based at the University of Sussex. This article is an extract from a paper prepared for the Inclusive Society Institute under the title of “Rebuilding SAA through strategic partnerships and improved governance”.
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