THE immediate past president of a pressure group made up of different professionals in the aviation sector, otherwise known as Aviation Round Table Safety Initiatives (ASRTI), Dr Gbenga Olowo has emphasised the need for the domestic airlines to form two major carriers in order to be stronger and relevant in the business of airline.
Speaking at the Annual General Meeting/second quarter 2023 brunch business meeting organised by the group in Lagos, Olowo making his speech on his last day as the president of ASRTI before stepping aside having coordinated the group for nine years, insisted that the ability of the domestic carriers to become formidable and withstand strong competition from foreign airlines rests on their willingness to merge.
The former ASRTI president who declared that it will be herculean for the domestic airlines to withstand strong competition without collaboration, cooperation and or merger, proposed the collapsing of all the airlines into two airlines.
Citing how similar collaboration and merger carried out in the banking sector was successful, Olowo said this policy should be embraced by the domestic airlines to enable them dwell on fleet size rather than share to capital.
His words: “Permit me to again fly a kite on Collaboration, Cooperation and or merger by establishing two competing oligopoly flag carriers a la Babangida NRC, SDP political solution, the most successful political experiment that was truncated.”
Using two of the foremost international alliances of the Oneworld and Skyteam which saw mega carriers around the world forming strong mergers, he said the alliances gave the foreign carriers the ample opportunities of delivering sumptuous services globally with each of the airlines still maintaining its own individual identity.
“If our airlines (who are competing) can go to court on common interest, they can as well come together to drive a more efficient service delivery. I propose two airlines christened NIGERIA FIRST”.
Under the two proposed alliances, Olowo suggested that ‘Nigeria First Airlines – alliance be led by Air Peace being the largest domestic airline.
According to him, with the coming together of the airlines to be christened ‘White airlines’ as led by Air Peace, the group would be able to boast of 51 fleet size coming together from their joint fleet, while the second group he categorised as ‘Green’ that will be led by Arik Air, when put together, will enjoy a 53 fleet size alliance.
In his analysis, Air Peace operates 30 aircraft, Ibom Air 7, Overlad 7,United Nigeria 4. with Green Africa operating 3 aircraft, all totaling 53 fleet size.
Under the Green airlines group Olowo suggested to be led by Arik Air, their coming together will see them jointly owning 51 aircraft out of which 17 belongs to Arik, 13 fro Max Air, Dana 7, Valuejet and Rano 5.
“Airlines A & B must develop robust schedules for their total fleet, to operate all Domestic, Regional and International destinations. We have today two (2) handling companies in healthy competition”.
Maintaining that Nigerian airlines remain small and highly fragmented, with the eleven of them put together having 104 aircraft, Olowo remarked: “Our eleven Airlines with a total fleet of 104 aircraft is less than the one controversial Ethiopian airlines (ET) who parade 144 aircraft in its fleet for example.”
“Our eleven Airlines with a total fleet of 104 aircrafts is less than the one controversial Ethiopian airlines (ET) who parade 144 aircrafts in its fleet for example.
Tell me, competing out there, will be a herculean task without collaboration, cooperation and or merger. Merger was successful in banking and should be successful in Aviation, dwelling on fleet size rather than share capital.”
Olowo who described the on time Performance (OTP) of Nigeria Airlines as woeful & deplorable with an average of 61% delay (except Ibom, 30%) yet very far below acceptable world average, declared that sustaining fights in a slot regime such as on London New York City, Johannesburg etc with such deplorable on time performance will be practically impossible.
“Truth be told, this is either a reflection of inadequate fleet size, poor maintenance and or inefficient workforce outside the questions of weather, technical, etc.”
Citing the flight data on Q1 2022 released by the Nigerian Civil Aviation Authority (NCAA) which stated that a total of 23,599 flights were operated on domestic routes in the first three months of 2022, out of which 14,130 flights were cancelled in Q1 2022 on domestic routes, representing 59.87 per cent of such flights, Olowo however said this “notwithstanding, we can make use of what we have, to change the status quo.”
and then