DIRECTOR General of the Nigerian Civil Aviation Authority ( NCAA), Captain Musa Nuhu has given some insights as to why airlines are reducing fares stressing that they ( airlines) may be suffering over capacity and that these fares may not affect safety in any case.
He however said that the NCAA is on top of airlines’ economic regulations and if any is caught cutting corners, it would invoke a full audit.
The DG was reacting to questions from the media relating to a heated debate on some flash fares and how it may or may not affect safety stating that no business will intentionally under cut itself to the point they will not break even.
According to him, airlines do their finances and economics and determine a reduction of airfares based on a number of factors stressing that only these airlines which have done their own business analysis can explain the reasons behind their slashing of airfares.
On the impact on air fares to safety he said, “I believe these airlines have done their proper analyses to reduce those airfares and there are many factors, they only can explain the reasons behind their slashing of airfares.
“Maybe they have excess capacity and instead of leaving that excess capacity to go to waste they rather make some money out of it, so there are many reasons. Airlines may slash their fares maybe they want to relate to a particular market segment after which they will adjust their fares accordingly.
“Airline finances and economics are interesting subjects and airlines have their reasons for doing that.
On the safety level, vis a vis reduced fare he continued,”
It is our responsibility to ensure they comply with all our standards and regulations and I don’t think and business will intentionally under cut themselves to the point they will not break even, I mean, let’s understand, these people have invested millions of dollars in their business, to me, it will be fool hardy to shoot yourself in the leg by cutting your airfares to the point that you are no longer profitable or break even.
“So, it is the airline that can decide and knows the internal workings, efficiencies and deficiencies that can really determine and explain the reduction in airfares.
“For us, if we sew trends or indications of them trying to cut corners, then we will do a full economic audit of the airline to ensure they comply with that. So far nothing. There are many indications to show an airline has issues.”
