Fleet depletion, capacity cut, poor services put carriers on the brink

Airlines have reduced their flight service to many airports, thus selling fewer seats that do not meet the demand of travellers, hence relatively higher prices amid poor services threaten an industry that has potential for growth, writes, WOLE SHADARE

Tough times, poor services

Nigerian carriers are going through one of their toughest challenges in many years as airlines are grappling to stay afloat. The numbers are drying up. It points to one thing. The carriers are on life support and their future looks bleak.

The country’s airline industry has taken a hit; no thanks to the downturn in the economy and the purchasing power of many Nigerians.

Poor services daily confront passengers who pay heavily to get seats on airplanes. While they do that, they are delayed for hours with no tangible reasons for delays other than blame it on ‘operational reasons’. The operational reasons can never be understood. They are euphemisms for inefficiency and a lack of clear understanding of what the aviation business is all about. Yes, they are constrained by so many factors, but they have failed to cover themselves in glory as well with many of the poor customer relations with customers.

Aircraft in limbo

At the tarmac or ‘graveyards’ of many airports lies the carcass of aircraft that once adorned the skies while many more are waiting to be taken there; further depleting the number.

Despite the proliferation of airlines in the country, the entire fleet of Nigerian airlines combined is 40% of Ethiopian Airlines.

In the past, some airports received four flights a day but now it has reduced to one as load factors have plummeted in the last few months.

Flights have stopped coming because many airlines’ aircraft are on AOG (aircraft on the ground). Most of the airlines’ aircraft don’t fly for the moment. It is the number of fleets owned by the airlines vs the airworthy ones.

One of the industry stakeholders confirmed that about half of Nigerian airlines’ fleet operating scheduled flights have parked, adding that this should concern the industry.

Gradual depletion

It is now difficult to get flights to many domestic destinations due to the paucity of operating aircraft. 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.

Dana Air is out of operation. Arik just came from the self-induced crisis that took it out of operations for nearly one week with just about three serviceable airplanes in its fleet.

Air Peace once reputed for having nearly 35 aircraft no longer has that number of serviceable airplanes in its fleet as some of them have gone for repairs and are yet to return while others are reported to be grounded and in disuse.

There are indications that 13 of Air Peace aircraft are AOG in maintenance facilities overseas and there are no funds to pay and bring them back.

Expert’s view

President of Topbrass Airlines, Roland Iyayi said, “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 the government”.

The rank of domestic airlines is further depleted as one of the carriers, Azman Air last week suspended its operations indefinitely.

The airline in August last year suspended its operations indefinitely citing a shortage of aircraft while at the same time sending its staff on leave without pay.

Airlines suspend services

The year 2024 has not been the best year for the domestic airline industry and the entire aviation sector. The woes of Nigerian airlines have been worsened by the challenging macroeconomic environment – galloping inflation, and high cost of foreign exchange, among others.

Azman is a Nigerian-based domestic airline originally established in 2010. It began operations from Mallam Aminu Kano International Airport, Kano in 2014, initially using a pair of Boeing 737-500 aircraft.

In October 2017, Azman Air leased an Airbus A330 from Egyptian charter airline Air Leisure for international routes to both the Middle East and Asia, principally serving Haj traffic to Saudi Arabia. The airline had returned to only flying domestic routes within Nigeria by early 2020.

The latest suspension was triggered because all of Azman Air’s Boeing Boeing 737s (two Boeing B737-300s, and four B737-500s) are due (or already undergoing) C-checks, though high operating costs have also been given as a reason for the suspension. Staff have been asked to take unpaid leave until flying resumes.

The financial difficulty faced by airlines has impacted them negatively as they have scaled down operations, and aircraft. At the same time, poor services have gone a notch higher with many passengers bearing the brunt of escalating ticket prices for appalling services.

Airfares are said to be on the high side. The most trafficked route on the network, Lagos-Abuja has an average fare of N120,000 per passenger for an hour flight. This translates to about $83 at the current rate per passenger.

Meanwhile, flights on the B737 series in Europe offer $40 per passenger with the same equidistance. The influx of airlines could help to bring down fares, especially on routes like Lagos-Abuja; Abuja-Port-Harcourt; Lagos-Owerri; and Lagos-Enugu.

Customer confidence in Nigerian airlines is another reason air travel demand is deemed low. The aircraft stock shows that the average fleet age is about 20 years or more with a few exceptions.

This contrasts sharply with fleet age for Africa’s best airline Ethiopian Airlines for example is said to have an average fleet age of five years.

Nigeria is blessed with the biggest domestic aviation market on the African continent, bigger than South Africa, Kenya, Ethiopia and many other countries. Surprisingly, Nigeria has not been able to harness this market for its benefit. The beneficiaries are foreign airlines. Nigerian airlines need to work together. The acquisition of 10, five or fewer aircraft is nothing in the world of aviation.

The Nigerian aviation sector is very vibrant. There are many airlines, which is a good thing in a way, but the problem is that none of them is profitable.

Small market with potential

Nigerian airlines are small, with fleet sizes as low as four aircraft for some airlines. The actual market is equally small. Although market potentials exist along several under-utilised air corridors, the smallness of airlines does not permit them to explore these potential routes.

Last line

Not a few believe that increased demand for air travel needs to be engineered. While the demographics and geography are favourable to air travel, the prohibitive costs of air travel are traced to supply-side costs of operations, maintenance, taxes and other regulatory charges. The government has been urged to grant new entrants tax holidays and other regulatory charges to make for the stability of their operations for at least two years.

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Fleet depletion, capacity cut, poor services put carriers on the brink

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