Baggage mishandling is falling sharply, but airlines still face a USD6.3 billion problem

The airline industry has achieved something that once appeared difficult to reconcile with record passenger volumes: baggage mishandling is falling. SITA's 2026 Baggage IT Insights report shows that the global mishandling rate fell 23% in 2025, while the number of mishandled bags declined 19%, taking performance below pre-pandemic levels for the first time.

Yet the operational problem remains stubbornly expensive.

Some 24 million bags were mishandled during the 2025 calendar year, generating an estimated USD6.3 billion in industry costs - equivalent to around 15% of global airline profits.

The significance of the report therefore lies less in the headline improvement than in what happens next. Technology, real-time tracking, connected data and AI are beginning to shift baggage handling from a reactive process towards predictive intervention.

But adoption remains uneven and transfers continue to account for 39% of mishandling. Regional performance also varies sharply, reflecting differences in infrastructure, network complexity and technology deployment.

The next phase will test whether airlines can convert better visibility into genuinely preventative baggage operations.