‘Harsh environment causes airlines’ failure’

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An expert in the aviation sector has linked majority of airlines’ failures in the country to the harsh operating environment.

He said this has reduced the number of operational airlines in the country from 150 in 2000 to less than nine.

The Nigerian Civil Aviation Authority (NCAA) few weeks ago said when the regulator commenced operation in year 2000, it had 150 operating airlines in its register, but that number has reduced to about nine.

The President and Chief Executive Officer, Sabre Network NMC West Africa and President of the Aviation Safety Round Table Initiative, Gabriel Olowo,  said 30 per cent of the failures of the airlines were as a result of mismanagement by the owners and 70 per cent are as a result of the harsh government policies.

Olowo, who spoke in Lagos, said: “I have been in the sector since 1973 and I have seen the airlines failing within a space of ten years they started operations. So, there is a common factor. The business of Nigeria Airways was government business. The problem of corporate governance has always been there.

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The airline was supposed to be repackaged and become a new carrier, but the then president said the government was not buying into the repackaging,” Olowo saidd.

He recalled that the second generation airlines, such as Okada Airline, Hak air, amongst others, all meant well, adding that Okada brought a Boeing 747 and that aircraft never flew but was left to rot.

“The operator of the airline got a promise from government, but we were looking at the airplane everyday positioned to do Lagos-London-Lagos routes. That was on the side of government and this was the same situation for Okada Cargo and Hak Air,” Olowo said.

He said as far back as 1994, exchange rate was around N22 to a dollar, while Nigerian airlines were selling one hour in Jet for Lagos-Abuja or Lagos-Kano at N2,200  at the exchange rate of N22, that amounted to $100dollars.

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“Lagos-Abuja was $100 value in 1994, which was about 23 years ago. Today exchange rate has moved from N22 to N450. Today, an airline sold ticket for N16,000, which is just the equivalent of $30.

“Someone in government should raise alarm on whether they want to kill the airlines. If I am in government, I will shut down the airline, because this is showing you desperation for cash flow. And they call it promotion. What kind of promotion?” He said the exchange rate will never make you earn the right tariff because people will not be able to buy the ticket.

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