Industry consultant, Sindy Foster raises concerns over real owner of 95% Nigeria Air equity
viation industry consultant, Sindy Foster has raised concerns over the majority owners of the new Nigerian national carrier, Nigeria Air.
Foster noted that the real issue at the moment is that Nigerians do not know who are the owners of 95% equity right now.
Speaking in an interview at the recently concluded 26th conference of the League of Airport and Aviation Correspondents in Lagos, Foster pointed out that, “for an airline to be launching and we don’t know who is the majority owners of this airline, is an issue, and that should be clarified before any aircraft takes flight anywhere”.
She maintained that It is always good for new airlines to start with three aircraft as it gives the airline the opportunity to travel to different locations.
According to her, you cannot operate functional airline with one or two aircraft because you have to build this contingency planning where you got an AOG situation, three aircraft is the minimum for starters.
On whether Nigeria Air is shrouded in secrecy, Foster stated that part of the information was readily available and was there online for everybody to see.
In her words: “The challenge we have in this environment is that people don’t read. They don’t access the information that is available and then they claim that things are shrouded in secrecy. It encourages people to operate in a more secret and less transparent manner because they know that people are not going to read what they are going to put out there. So the formula of ownership has always been out there: 5percent for the Federal Government, 49percent for the strategic foreign partners, 46 percent for Nigerians. So it was always out there.
The issue we have at the moment is we don’t know who are the 95 percent right now”.
On the exit of Dana and Aero, Foster explained that though their suspension of flight operations will result in temporary loss of capacity, but that it is actually an opportunity for the other airlines.
So the airlines who are remaining will now be able to fill those seats with passengers who would have gone with Aero and Dana, she said.
On the issue of Forex, she pointed out that the matter is not is not just an aviation issue.
According to her: We need to revisit what we are doing in terms of these parallel exchanges because if you’ve got a high rate for one parallel market, you’re going to drive most of the transactions in that direction so you are always going to have scarcity. So we need to look at the viability of maintaining this system that we have at the moment that just encourages the parallel market. That is not just a problem for aviation, it is a structural problem to deal with financial governance in Nigeria. So we can’t solve that as the Aviation, it needs to be solved for us.
Foster queried why the country is not refining aviation fuel locally because the oil prices have been rising and rising.
She said: “What has been done to localize the domestic market for refined petroleum products in Nigeria? We have refineries which are moribund, they keep talking about fixing, fixing what when manufacturers of the equipment have told us it’s obsolete. You should be looking at rebuilding. You should be looking at investing in modular refineries. People have invested in modular refineries and are waiting for crude allocation. Why are they not providing crude to the modular refineries who are already built? Why are they not localizing the domestic petroleum refining industry? That will solve a lot of the issues that we have inherited inflationary cost and prices.”
On Airlines cooperation, Foster noted that the challenge in Nigeria is that there are too many airlines for the actual volume of passengers available, adding that it is very difficult for any individual airline to generate scale.
In her words, “So that is where the collaboration comes in, that’s where code sharing comes in so that you can share the cost of operating one flight amongst maybe three or four airlines who are selling tickets on that flight. If you look at international airlines, quite often you see five airlines selling seats for the same flight. But here, everybody wants to be the leader. Nobody wants to collaborate. Partnership breaks down very quickly”.
In his opening remarks, the chairman of LAAC, Mr Olusegun Koiki noted that in recent months, the various players in the Nigeria’s aviation industry, especially airlines, airport operators, oil marketers, ground handlers, catering services and all safety stakeholders had to contend with a mirage of challenges, which have all combined to build a huge obstruction of the desired and projected revenue bottom-line for all stakeholders.
Koiki stated that Nigeria’s entire economy has, within the last one year, been evidently been negatively impacted by the challenges of the aviation sector related to airport operations.
He stressed that it is important that in the execution of the nation’s airport activities and plans, the industry should incorporate considerations for air travellers’ interests and the interest of other airport users.
Both government and private business concerns should in policy formulation, also be concerned about the economic interest of airlines, handlers and other service providers, Koiki said.
In his words: “A situation whereby a litre of Jet A1 goes as high as N800 is ridiculous. A situation where a dollar is now over N600 in the alternate market because that is the only avenue where business organisations now run to, to get the currency for operations is indefensible. Though our government attributes these challenges to the ongoing war between Russia and Ukraine, but, the League reiterates that our investors are vulnerable in their operations and cannot compete with the current situation”.
He noted that the appropriateness or otherwise of the operation of some airports only at sunset has been a source of controversy among players which significantly portends implications in terms of economics and safety for all.
LAAC chairman pointed out that the operation of sunset airports in Nigeria over the years has obviously influenced the performance of airline operators in particular, the ground handling companies and the entire aviation industry in general.
He observed that although the Federal Airports Authority of Nigeria (FAAN) has made it clear that Nigeria’s airports are not viable for 24 hour operations, aviation stakeholders have expressed displeasure over what they perceive as underutilisation of aerodrome facilities nationwide, despite huge potential that abounds in the air transport sector.
He said there are about 18 airports across Nigeria that operate only during the day out of 22 aerodromes across the country, while only four international airports currently operate a 24-hour schedule.
Koiki added that as stakeholders in Nigeria’s aviation industry, the improved performance of airports, airlines and other players is our major priority.
He said the Nigerian aviation industry needs to be at par with its counterparts elsewhere, stressing that there is no local aviation industry.
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