Nigerian Airline Industry: A long road to recovery

The surge in oil prices and the reduction in the number of air travelers may suggest that the industry's hope of recovery could be a long one.

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The aviation industry has begun to recover from the massive hit of the unexpected pandemic. It has however been a rather slow recovery. The surge in oil prices and the reduction in the number of air travelers may suggest that the industry’s hope of recovery could be a long one.

Nigerian Airline Industry

The government had earlier offered a 5 billion naira bailout fund to help the industry commence activities after the ease of lockdown measures. Several factors result in price increase, among a few are a decline in flight capacity (especially with the prevalent pandemic which demands social distancing thereby making it compulsory for empty seats).

Another distinct factor is most recent travels is on repatriation flights (there is however a bit of resumption in-flight activities). There has been forecast that there will be a continued rise in airfare due to the increase in aviation fuel by over 68.75%.

Scarce foreign exchange and an astronomical increase in aviation fuel price from N160 to N270 in just four weeks have contributed to the fare hike. The industry is presently at an edge with the burden of the harsh economy borne on travelers and airline operators.

The persistent rise with no prior possibility of a reduction any time soon have provoked airline owners to send a ‘Save our Soul’ message to the federal government. Chief Obiora Okonkwo, Chairman of United Nigeria Airline while speaking with journalists stated that critical efforts must be undertaken to curb the current surge to redeem the airline industry as well as make it affordable for Nigerians.

Aviation industry stakeholders in a bid to beat the 10-year ceiling for closure and ease in running activities have advised domestic airlines to come together to form a merger. The report has it that there is barely one domestic airline in Nigeria that has reached as far as a 10-year lifespan apart from Aero Contractors, formerly controlled by a British technical partner.

This is rather disturbing especially with the covid-19 pandemic increasing the cost of operations as airlines are burdened with the extra cost of adhering to safety measures.

John Ojikutu (Rtd.), former Commandant, Murtala Muhammed International Airport (MMIA) while speaking on the need for merging of local airlines stated that the rejection of the merger is largely due to personal ego. Domestic airlines are experiencing difficulties in the area of high mortality and several operational factors coupled with many shortcomings in the government policies.

Captain Ojituku added that the absence of an adequate definition of government policy on private airline operators has led to negligence in the handling of their earnings and debts, particularly to the government service providers.

Ojituku affirmed that government policy review should profit operations in domestic routes for at least four years alongside good economic or commercial audit reports of another four years, before the approval of private airlines for regional routes.

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Comrade Abdurasaq Saidu, secretary-general of the Association of Nigerian Aviation Professionals (ANAP) also posited that personal ego has ravaged the option of a merger. He however stated that some indigenous airlines have foreign interests, and taking direct decisions in the area of a merger would be a tough one.

Saidu however stated that “if they can merge, it will save them a lot of economic losses, including saving fuel, better corporate governance, larger fleet and even route utilization within and outside the country”.

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Wichita State University’s Headley had earlier predicted that reduced flight schedules will result in “a bit of an unknown” in the area of pricing and that fewer flights could yet lead to higher ticket prices too.

The Nigerian airline industry more urgently than ever needs saving. The sector is on the brink of sinking and requires government intervention. The road to the sector’s recovery may take a longer period than estimated. Adequate financial assistance and policy regulation would however go a long way in reviving the sector.

Peace Omenka

I'm a news reporter/ researcher. My major expertise is developing feature stories around trending issues.

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