By Chinedu Eze
Traffic in the domestic operations of Nigerian airlines has significantly reduced, THISDAY investigation has revealed.
Industry operators attributed it to two factors: the decline in the purchasing power of some Nigerians, who hitherto travel by air and seasonal low patronage.
They noted that airline travel is usually low in January and peaks in December when many people overseas are returning home and those who live in the cities at different parts of the country fly to the nearest airports enroute their villages to celebrate the Christmas.
Checks by THISDAY showed that the economic downturn beginning to take a toll on the number of people that travel by air to local destinations. The number has significantly reduced and industry experts fear this would get worse as the economy continues to nosedive.
They have also expressed concern that the economic downturn might force some airlines to go out of business.
However, industry consultant and CEO of Belujane Konsult, Chris Aligbe agreed the difficult time would hit the airlines hard but it would not be devastating enough to make them go out of business.
“I don’t think the economic downturn will bring down the airlines; although they are experiencing low patronage, but it is a normal thing. This happens globally. Whenever there is economic downturn it affects patronage but the adversity this will cause the airlines will not force them to go under because few of those who prefer to travel by air will switch over to road travel because most of the roads are in deplorable condition. They are not effective alternative to air travel,” Aligbe said.
He noted that if the economic crunch continues, some airlines might be forced to close some of the routes they operate, stressing that the airlines would not go down “because if they go down they may not be able to get up.
He said: “The collapse of any airline will be terrible for Nigeria, so government should work towards giving the airlines support because it has never been as urgent as now and it is expected that the Minister of Transport, Chibuike Amaechi and the Minister of State for Aviation, Senator Hadi Sirika should have invited stakeholders in the industry for a meeting to address problems in the industry. Amaechi has a lot of strength in him and Sirika knows the industry very well.”
An industry operator confirmed on Wednesday that airlines are recording low passenger movement but that the major challenge is the low exchange rate, which is forcing them to exchange the Naira earned with Dollars “as highly exorbitant rate.”
The operator said this would affect maintenance, training and aircraft acquisition or lease.
Industry observers said airlines might be facing a very tough challenge this time because tickets are sold at relatively low rate by airlines due to competition and pay high charges, which leaves them with very low margin of revenue.
“Now, if the traffic is down it will make the revenue margin worse which means it will be difficult for airlines to pay for major maintenance, fuel their aircraft and pay their workers. The situation is dire; that is why government should facilitate single digit, long-term loans for airlines. Although we are running airline as business, but what we do is strategic to the economy. Government cannot allow the airlines to be in such a quagmire,” the operator told THISDAY.
