NICK Fadugba, publisher of African Aviation magazine and aviation consultant have expressed worry over the high number of airlines in the country which do not have critical mass In terms of fleet size and routes to compete effectively and make money.
Fadugba who spoke at at the just concluded Aviation Safety Round Table Initiative’s 2017 conference, In Lagos themed: “Nigerian Aviation Infrastructure: Development and Challenges” said the entire fleet of Nigerian airlines combined is 40% of Ethiopian Airlines.
He therefore called on Nigerian airlines to work together especially on training, on maintenance, on spares pooling, on spare parts purchasing as this would help lower their cost.
Fadugba said, “We have a situation in Nigeria today where we have too many airlines which are too small, and their market is fragmented. None of the airlines has a critical mass, in terms of fleet or route network to become effective and to make money. ”
“When you look at Ethiopian Airlines, the combined fleet of all Nigerian airlines is about 40 per cent of the fleet of Ethiopian Airlines. We have approximately 40 aircraft as a country, all our airlines. Ethiopian Airline has 90 plus aircraft and most modern you can imagine. Not only that, in the next few years, they will operate about 130 aircraft. So, you see Ethiopian is thinking on a bigger scale. You could say that in Ethiopia they have a monopoly, which is very different from Nigeria. ”
“And in Nigeria of course we have a very vibrant economy which is not a monopoly. We have many airlines which is a good thing in a way, but the problem is that none of them to the best of my knowledge is really, profitable. So, what I will recommend for our Nigerian airlines: They need to work together. They can compete for example on Lagos-Abuja or Abuja-Port Harcourt. They can work together on training, on maintenance, on spares pooling, on spare parts purchasing. ”
“There are many areas they can work together. They can still compete. It is done in the rest of the world. They can still compete and collaborate. More importantly, I would like to see Nigerian airlines come together. ”
He identified ego as a factor militating against collaboration but cited examples where such collaboration has been possible and profitable.
He said, “Ego is a big factor. It is a negative factor in the airline industry in Nigeria. It is pulling us back. If you look around the world, British Airways is coming to Nigeria. Collectively within the IAG Group, they have about – 600 Plus aircraft. Delta Air Lines, over 600 plus aircraft. Or the Emirates, you can imagine huge planes. And yet, we have the market in terms of passengers. ”
“Everybody wants to come to Nigeria. If you look at any market in Africa, the most popular one is Nigeria, because you can be sure as a foreign airline, you will fill your aircraft probably from the front because Nigeria like to travel in style and can afford it. It is a strange market where the aircraft fills from the front, The first class, the business class and then the economy. ”
“You do not get that in South Africa or in Ethiopia or Kenya. The aircraft tends to fill from the back but Nigeria, it is from the front. That means that the premium, the ticket yield is very high, and it can be profitable. And of course, the load factor in Nigeria is unusually high, compare to the rest of Africa. ”
“So, I will like to see Nigerian airlines work together. They need to codeshare. It is quite a surprise and a disappointment that no airline in Nigeria are code-sharing. For example, if a flight is delayed on airline A, you can quickly send your passengers to airline B if you have interline agreement and codeshare. You know it is what they do in the modern world and we need to do it in Nigeria.”