Nigerian carriers in urgent need of support, say aviation experts

BY CHUKWUEMEKE IWELUNMO

Some aviation experts in the country have taken a holistic look at the industry and came up with a verdict that the aviation industry in Nigeria needs urgent rescue to get out of its precarious situation.

Aviation consultant and the Chief Executive Officer of Belujane Consult, Mr Chris Aligbe while featuring alongside other analysts, Mr Toni Ukachukwu and the Secretary General of Aviation Round Table (ART), Mr Olumide Ohunayo on a television programme said Nigerian carriers would extremely find it difficult to compete with foreign carriers on the international scene because of the point-to-point, describing the method as archaic by operating as a standalone airline.

The trio admitted that the airlines are in intensive care units and called for urgent assistance to operate in a favourable environment.

Delving on the international routes by some flag carriers, Aligbe reiterated that no airline will survive with point-to-point.

He, however, lauded the efforts of the Minister of Aviation and Aerospace Development for taking the Cape Town Convention a notch further with the CTC practice direction that was enforced on September 12, 2024, adding that it has brought back dry-lease arrangements for Nigerian carriers as opposed to wet-lease arrangement that are very costly to the operators.

He said, “In fairness to airline operators, they face many economic challenges, access to foreign exchange, rising cost of fuel and operations. Everything is stacked against them. From 2017, the issue has been that of wet lease”.

“In aviation, we call wet lease the ACMI (Aircraft Maintenance and Insurance). You don’t use your crew; you don’t pay the insurance and maintenance. Everything they give to you is quite high. What they pay pilots out there is far higher than what is paid to the technical crew and what you even pay for the aircraft. You have no time to manage it.

“What you do is to manage the operations and that is why it is heartwarming that the government, the Vice-President, the aviation minister, the finance minister and the Chief Judge of the FCT signed the CT Practice Direction. It was not the CTC that was signed because people make the mistake of saying CTC. CTC was signed and domesticated in 2007. It was during the tenure of Dr Harold Demuren as Director-General of NCAA and by March 2007, that document was deposited”.

“After 2007, two Nigerian airlines, First Nation and Topbrass violated the CTC. Immediately they violated the CTC, Nigeria became blacklisted and once we were blacklisted, airlines could no longer get aircraft on dry lease and that was when the challenge came in. It is a major effort and success that we can return Nigeria to what it was before. We are back to dry lease.”

Ukachukwu stated that the problems of the carriers are combination of lack of Forex Exchange, unfavourable environment and regulatory issues, adding there are concerted efforts by the Minister to begin to unlock these areas to ensure that there are favourable conditions for the airlines.

He further stated that a wet lease is one of the things that is crippling airlines in Nigeria because lease rental is done for the country’s carriers at a high premium following the blacklist of Nigeria which was seen as high risk.

“The aviation industry is highly dollarized. Everything they do in the aviation industry is dollar and if we have FX issues, it directly impacts the operators and the aviation industry. Another is the jet fuel which accounts for 60 per cent of the operating costs.

“These two factors will give rise to the high cost of tickets because the operators want to stay in business but not only stay in business, but they must make sure that their operation is safe, and they don’t operate in any shape or form. It is a very tough time for the airlines. The airlines are in intensive care units because they need the full support of a favourable”.

Ohunayo hinted that the CTC practice direction was a relief for carriers but noted that that alone was not a one-fit solution for the carriers.