Olowo supports airlines on fare hike amidst challenges

President of a non-governmental body, Aviation Safety Round Table Initiative (ASRTI) Dr Gabriel Olowo has justified any move by the Nigerian airlines to charge fares that are commensurate with their cost of operations in the face of the ongoing astronomical rise in the prices of aviation fuel (Jet A1) which has affected airline operations and their finances.

He however called for thorough monitoring of the airlines by the Nigerian Civil Aviation Authority (NCAA), stating that a price increase was better than negotiating safety by cutting corners.

Olowo’s position came amidst the hike in fares by the airlines and apprehension that fares will further increase in view of the myriad of challenges confronting both the local and foreign carriers operating in Nigeria.

On the domestic scene particularly, the price of Jet A1 has skyrocketed more than ten times in 2022 alone with no respite ahead.

As of now a litre of the commodity which sold for N200 in February 2022, is selling for between N700 and N800 depending on the marketer and the airport of purchase.

Lamenting how the price of the commodity continues to rise on a daily basis, Olowo noted: “Our portal reported that Jet A1 in Lagos sells for N822 per litre while in Abuja the product sells for N859. In Port Harcourt, jet fuel sells for N852 per litre while it sells for N890 and N892 in Yola and Maiduguri respectively.”

Olowo who was speaking on the topic ‘Sell what you buy’, declared that in view of the uncontrollable circumstances within the aviation sector, it was better for airlines to factor in their extra costs and hike fares to cushion the effect of the hardship that will discourage the alternative option of cutting corners.

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“This is my candid opinion to airlines, given these uncontrollable factors of production in the airline industry sector. Demand will definitely drop but much better than cutting corners and planning an accident.

“If a trip fuel is 4000 litres for a one hour on jet (LOS-ABV) for example at N800 per Iiter which gives N3,200,000 and a load factor of 100 passengers, This means fuel cost per passenger is N32,000 and this is approximately 30 per cent of the total cost. This will translate to a N107,000 tariff for one way journey.

“PHCN has introduced Premium Tariff on power and those who can afford it are settling for it. This is not the time for frivolous and reckless competition or uneconomic patriotism. Operators should intensify cooperation, collaboration, consolidation, and prune schedules to minimize perishable seats and maximize load factor. The spirit of Spring Alliance must be strengthened.”