In this article, we will take a look at the 10 most dangerous airlines in the world. If you want to skip our discussion on the airline industry, you can go directly to the 5 Most Dangerous Airlines In The World.
Air transport is essential for the development of the global economy as it facilitates connectivity. It enables the free flow of goods, technology, capital, people, and ideas across the globe to support the economic cycle. However, the onset of the COVID-19 pandemic brought an abrupt halt to air transport. This disruption significantly impacted airline operations globally, resulting in the industry experiencing an unprecedented loss of $140 billion in 2020.
In 2023, the airline industry witnessed a substantial recovery post-COVID-19. The industry-wide revenue for 2023 is projected to reach $896 billion, surpassing the International Air Transport Association’s (IATA) June outlook by $93 billion. The expected profit is also $9.8 billion higher than the previously predicted value. This jump in revenue is due to a significant increase in passenger business throughout the year. Passenger traffic recorded a 40% YoY increase in September and achieved 92.9% of the pre-pandemic levels. Moreover, with the exception of Asia Pacific, all regions worldwide are expected to either reach or exceed the 2019 levels of passenger traffic in 2023. Conversely, the cargo segment of the airline industry faced a slowdown this year, with cargo tons per kilometer being lower than the levels in 2022. The primary reason for this is the deceleration in global trade. However, IATA predicts a 4.54% growth in this segment next year.
Even with such a significant and fast turnaround, the airline industry faces its own set of challenges. The most significant of these challenges is the vulnerability of this industry to external factors. These factors include economic slowdown, geo-political challenges, rising oil prices, supply chain issues, and regulatory pressures. Furthermore, air safety is one of the major concerns affecting airlines’ operations. A high-profile air crash can easily tarnish the reputation of an airline, leading to a decline in revenues as passengers switch to competing airlines. Hence, notable companies such as American Airlines Group Inc. (NASDAQ:AAL), United Airlines Holdings, Inc. (NASDAQ:UAL), and Delta Air Lines, Inc. (NYSE:DAL) spend millions to ensure compliance with all safety standards and aim to be one of safest airlines in the world. You can also check out the 20 Best Airlines in the World in 2023 here.
Here’s what Patient Capital Management said about Delta Air Lines, Inc. (NYSE:DAL) in its Q3 2023 investor letter:
“Airlines returned to trough multiples as higher oil prices pressured costs. Historically, airlines have passed these costs on to customers. We think Delta Air Lines, Inc. (NYSE:DAL) is a premium brand valued like its economics aren’t sustainable. With mid-teens returns on capital, significant free cash flow generation, excellent capital allocation and long-term earnings per share growth in the high-single to low-double-digits, we think the company is significantly mispriced.
Delta Air Lines Inc. (DAL) reversed course in the third quarter, falling 24% from its highs in July. The airlines in general were hurt from rising commodity prices that are leading to increased cost per available seat mile (CASM). Historically, airlines have passed on higher fuel prices to customers with a lag. We see Delta as a premium global consumer brand that is materially misunderstood by the market. The market still sees airlines as a cyclical, bankruptcy prone industry. An improved supply-demand picture, management discipline and a better business mix make Delta a more resilient business. Their loyalty program with American Express is a source of stable and growing revenues with $6.5B in remunerations this year with a goal of reaching $10B by the end of the contract in 2028. Premium and ancillary service revenue should generate 65-70% of the total in the next year or two. The company should continue to generate consistent mid-teens returns on capital. As the market begins to understand, we believe the company will continue to be rewarded. On top of this, free cash flow is expected to expand generating a cumulative ~$11B from ’23-’25, or one-half of its current market cap. As the company pays down debt while growing the dividend and eventually resuming share repurchases, we think the stock will continue to trend higher.”
The last few decades have seen significant advances in aircraft engineering, which have rendered aviation the safest mode of travel. In 2022, IATA reported 1.21 accidents per million sectors. This is an improvement of 48% as compared to 2013, when 2.31 accidents per million sectors were reported. While most of the airlines remain safe, there are some which have terrible safety records. With this context in mind, let’s begin our list of the 10 most dangerous airlines in 2023.
An Airbus single-aisle aircraft overfly a major city, showcasing the airline services of the company.
Our Methodology
To shortlist the 10 most dangerous airlines in the world, we consulted the Aviation Safety Network and Airline Ratings databases. Airline Ratings is a platform that rates over 350 airlines worldwide based on multiple metrics using a 7-star scale. Our evaluation considered the number of fatal accidents in the last 10 years, incident rating, and audit status for the shortlisted airlines. Fatal accidents include only those accidents which caused the death of the crew and passengers on board. Incident Rating takes into account serious incidents caused by the pilot’s mistakes. Meanwhile, the audits considered for the rating include the IOSA audit, ICAO country audit, and EU and FAA bans, indicating an airline’s commitment to safety regulations. The 10 most dangerous airlines in the world have been ranked in descending order of their ratings.
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10 Most Dangerous Airlines In The World
10. Blue Wing
Rating: 1 out of 7 stars
Number of Fatal Accidents in Last 10 years: 0
Audit Status: Did not pass IOSA audit and blacklisted in the EU
Blue Wing is a regional airline based out of Suriname. There have been numerous safety concerns regarding this air carrier since its launch in 2002. Although no fatal accidents have been recorded during the last decade, the airline’s record is not flawless. Blue Wing was involved in fatal air crashes in 2008 and 2010, which took the lives of 19 and 8 people on board, respectively. Apart from this, Blue Wing Airlines has been involved in a couple of serious non-fatal accidents since it started operations. Moreover, it has not passed any audit and was blacklisted by the EU for the second time in 2010.
9. Air Blue
Rating: 1 out of 7 stars
Number of Fatal Accidents in Last 10 years: 0
Audit Status: Did not pass IOSA audit
Air Blue is a Pakistan-based airline with a poor safety record. The most high-profile crash of this air carrier was in 2010 when an Airbus 321-200 crashed in the hills near Islamabad, killing 146 people on board. Additionally, there have been several instances of engine issues, hydraulic failures, and runway excursions reported in the airline’s flights since 2012. Air Blue has failed to meet the minimum safety requirements to pass the IOSA audit.
8. Sriwijaya Air
Rating: 1 out of 7 stars
Number of Fatal Accidents in Last 10 years: 1
Audit Status: Did not pass IOSA audit
Established in 2003, this Indonesian airline initially operated domestic and international flights to three destinations. The airline has experienced several incidents leading to aircraft damage, injuries to both crew and passengers, and fatalities. In 2021, the airline experienced a fatal crash involving one of its Boeing 737-500 shortly after take-off from Jakarta, resulting in the loss of all 62 passengers and crew members. Due to these safety issues, the airline has faced bans and has been unable to obtain international certification.
7. SCAT Airlines
Rating: 1 out of 7 stars
Number of Fatal Accidents in Last 10 years: 1
Audit Status: Passed IOSA audit
SCAT, a Kazakhstan-based airline, started its operations in 1997. It currently operates flights to major cities in Kazakhstan and neighboring countries. Despite passing the IOSA audit, the airline’s safety record raises concerns. Numerous other incidents, including takeoff issues, landing troubles, faulty nose gears, and even deflating tires, have been reported in the last decade. The airline has been blacklisted by the EU due to a lack of trust in the country’s regulatory process. SCAT is in seventh place on our list of the 10 most dangerous airlines in the world.
6. Air Algerie
Rating: 1 out of 7 stars
Number of Fatal Accidents in Last 10 years: 1
Audit Status: Passed IOSA audit
The safety record of this Algerian-based airline has raised concerns in recent years. The airline experienced its most serious air crash in 2014, resulting in the death of 116 people on board. The investigation revealed that the crash was caused by the pilot’s mistake and inadequate training of the crew. Air Algerie’s use of outdated aircraft and poor maintenance practices has added to safety concerns. Despite these issues, the airline passed the IOSA audit and was removed from the EU’s list of banned airlines. Additionally, the airline has plans to enhance its fleet by adding new Boeing and Airmax jets, which may contribute to service improvements.
Some of the most popular airlines across the world include American Airlines Group Inc. (NASDAQ:AAL), United Airlines Holdings, Inc. (NASDAQ:UAL), and Delta Air Lines, Inc. (NYSE:DAL).
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Disclosure: None. 10 Most Dangerous Airlines In The World is originally published on Insider Monkey.
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