Mr Gbenga Olowo
Experts in the aviation sector have blamed the challenges facing
domestic airlines in the country on harsh operating environment.
The experts, under the aegis of Aviation Safety Round Table
Initiative (ART), said the environment, fueiled by bad policies, account
for high mortality rate of airlines than alleged mismanagement of
managers.
President of the ART, Gbenga Olowo, said 30 per cent of the failures
of the airlines are as a result of mismanagement by the owners and 70
per cent are as a result of the harsh government policies.
The implication is that until the authorities take critical look at the current operating policies with political will to make the environment business friendly, the plight of airlines and contributions to economic development will continue to worsen.
Recall that The Guardian had recently reported that no fewer than 40
erstwhile functional airlines have gone under in the last 17 years, with
some of the surviving eight facing bankruptcy.
Spokesperson of the Nigerian Civil Aviation Authority (NCAA), Sam
Adurogboye, had hinted that at the time NCAA started in January 2000,
there were about 150 airlines on the register, which came down to 28 in
2006, and eight as at today.
Olowo, who is also the Chief Executive Officer of Sabre Network NMC
West Africa, told reporters that airlines consistently have 10 years
lifespan because it is just almost impossible to survive the odds.
Olowo, with about four decades of experience in the sector, said he
had since 1973 seen airlines fail and fall for the same obstacle.
Though Nigeria Airways was a government business, its problem was not
any different from the second generation airlines such as Okada
airline, Hak air, amongst others that meant well but soon failed.
According to him, “Okada Airline for instance, brought a Boeing 747
aircraft. It never flew but allowed to rot away as investment was
wasted.
“The operator of the airline got a promise from the vice president
then 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, Hak Air,” Olowo said.
He also recalled that as far back as 1994, the 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 and at the exchange rate
of N22 that amounted to $100.
“Lagos-Abuja was $100 value in 1994, which was about 23 years ago.
Today,the exchange rate has moved from N22 to N450. Today, an airline
sells ticket for N16, 000, which amounts to $30.”
Olowo added that in an ideal setting, someone in government should
have raised an alarm and enquired of the manager’s “plan 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? Exchange rate will never make you earn the right
tariff because people will not be able to buy the ticket.
“So, you decide to reduce the price, meanwhile your cost is
increasing. The airlines in Nigeria currently are not charging the right
tariff after 23 years. If people cannot fly, then do not kill them. If I
am the NCAA DG, I will shut any airline that charges less than $100,”
he said.
