Nigerian Airlines Abandon 50% of Aircraft at Maintenance Facilities on Lack of FX

Chinedu Eze

It has emerged that the inability of Nigerian owned airlines to maintain their aircraft is worsening the prohibitive fares and low capacity

As at the last count, over 50 per cent of aircraft owned by Nigerian airlines are either parked at airports or at maintenance facilities in Nigeria or overseas, a development that has led to reduction in capacity and hike in airfares, as airlines continue to scale down their operations.

This has fanned the fears that domestic operations may be grounded or may shrink to skeletal levels that could affect the nation’s economic activities.

The major cause of the challenge, according to industry observers, is the inability of airlines to obtain foreign exchange to pay for the maintenance of the aircraft due to the depreciation of the naira, high cost of foreign exchange and the fluctuating foreign exchange regime, which leaves much to uncertainty.

THISDAY learnt that airlines have reduced their flight service to many airports, thus selling fewer seats that do not meet the demand of travellers, hence relative higher prices at low season.

The Managing Director of Asaba International Airport, Chrisopher Penninck, disclosed that in the past the airport used to receive four flights a day but now it has reduced to one, saying that load factor has been good in the past three months.

“But unfortunately flights have stopped coming because many of the airlines’ aircraft are on AOG (aircraft on ground). Most of the airlines’ aircraft don’t fly for the moment. It is the number of fleet owned by the airlines vs the ones that are airworthy.  Asaba airport has all the facilities to be open at night. This would help airlines to operate their fleet more efficiently.

But the extra cost to open later is terrible (charged by aviation agencies). We are ready but the policies and charges make it impossible. For example, we had only one flight to Asaba today (Wednesday, June 12, 2024). It was Air Peace flight. We used to have at least four flights a day, but that has crumbled,” Penninck, said.

One of the industry stakeholders confirmed that about 50 per cent of Nigerian airlines’ fleet operating scheduled flights have parked, adding that his should be a concern to the industry.

The Chairman and CEO of Quikio West Africa Limited, Dr Alex Nwuba, said he has raised the same challenge at different occasions but no attention has been paid to it despite the threat to ground domestic flight services.

He pointed out that it is now difficult to get flights to many domestic destinations due to paucity of operating aircraft.

But the member of Airline Operators of Nigeria (AON) and the President of Topbrass Aviation Limited, Captain Roland Iyayi, told THISDAY in a telephone interview that the major factor why many aircraft in Nigerian airlines’ fleet are grounded is because of foreign exchange.

Iyayi said 13 of Air Peace aircraft are AOG in maintenance facilities overseas, “and there is no funds to pay and bring them back because early last year, Air Peace paid naira equivalent of $14 million to the Central Bank of Nigeria (CBN), which it planned to use and pay for the maintenance of the aircraft under maintenance but the apex bank failed to pay the money to the airline.”

He said with such amount of money owed the airlines, they have to resort to wet leasing aircraft at huge cost in order to sustain their operation and revenues earned are used to pay for the lease and the airline may earn very little profit.

“This has led to reduced capacity, flight delays and flight cancellation, especially at sunset airports. So, the major reason why many aircraft owned by airlines on schedule service are parked is because of forex, then bird strike and other reasons. Now, due to reduced capacity, airlines cannot operate reliably. Airlines have complained severally but were not listened to. They have decided to face their problems quietly so that they will not be accused of antagonising government.

“But the airlines need government intervention. The same way government has solved the problem of foreign airlines should be the same way it should also solve the problem of Nigerian airlines by making dollars available to them. Government should address the crisis. The airlines are not asking for free money. Airlines should be enabled to access funds the same way manufacturers were given dollars at N800/$1. And if government is in doubt it should direct airlines to bring the names of the maintenance facilities where the aircraft are and it should pay the maintenance organisations directly,” Iyayi said.

Speaking in the same vein, the Managing Director and CEO of Aero Contractors, Captain Ado Sanusi, told THISDAY that what happened to the airlines was a reflection of the country’s poor economy, noting that if the economy is robust, airlines would have more aircraft in their fleet.

According to him, the number of aircraft reflects the status of the nation’s economy.

Sanusi complained that there is too much taxation in the aviation industry and this has made airline business unprofitable in Nigeria.

“There is the problem of multiple taxation. I brought Boeing 777 for hajj, the Nigerian Civil Aviation Authority (NCAA) charged me N34 million for inspection and the aircraft will do two flights so I will not make any profit from the business. The charges by aviation agencies are the most expensive in the world; that is why Nigeria is the most expensive place to do busines. Look at landing and parking they charge $42, 0000. So, what they have done has eroded the profitability of the business,” he said.