Domestic Airlines Struggle For Survival Amid Low Patronage, Cheap Airfares

other type of business acting as a broker of air travel (the lessee), which pays by hours operated. Over time, the aviation regulatory agency, that is the Nigerian Civil Aviation Authority (NCAA), issued a lot of Air Operators’ Certificates (AOC) and more airlines are still in the waiting list. Notwithstanding the increase in airline operators, there has been low passenger traffic in the local airspace, arising from poor patronage. This situation, which characterised the early part of 2022, has led to a sharp decrease in airfares as many airlines now try to load their airplanes. An assessment of the operations of local operators shows that there is hardly any fully-loaded aircraft flying from one destination to the other. The last quarter of 2021 witnessed an increase in airfares, with 100 to 150 per cent increase in the cost of ticketing. Analysts attributed it to the increase in demand for airline tickets during the festive period. The cost of fares to most cities, particularly Lagos, Abuja and Port Harcourt, has since crashed. The current prices range between N25, 000 and N30, 000, depending on the time of booking and purchase. This was a big departure from last year’s pricing, which was pegged at N40, 000 and N45, 000, while trips to places like Owerri, Enugu, and Asaba went up to between N50, 000 and N60, 000. However, some experts are worried, pointing out that very low fares are pointers to cashflow challenges, insisting that economic audit is necessary to ensure safety of passengers. But in his reaction, the Director-General of the Nigerian Civil Aviation Authority (NCAA), Capt Musa Nuhu, said it was up to the airlines to do its finances and economics and determine a reduction of airfares. According to the DG, the airlines involved must have done their proper analyses to reduce those airfares. He said there were many factors responsible and that only the airlines can explain why they slashed airfares. Nuhu said, "Maybe they have excess capacity and instead of leaving it to waste, they decided to make some money from it. So there are many reasons. Airlines may slash their fares, if bthey want to relate to a particular market segment after which they will adjust their fares accordingly." Emphasising that airline finances and economics are interesting subjects, he added, "Many people are of the opinion that with such reduced fares they may not be able to break even and thus resort to cutting corners." He however, assured that it is the responsibility of the NCAA to ensure that airlines comply with all its standards and regulations, sayng "I don't think any business will intentionally under- cut itself to the point that it will not break even. This 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 your business is no longer profitable or able to break even. So, it is the airline that can decide and it knows the internal workings, efficiencies and deficiencies that can really determine and explain the reduction in airfares." The NCAA DG claimed that the agency has been alerted to the situation and if it observes that the airlines are trying to cut corners, it will do a full economic audit of the airlines to ensure that they comply with that. Stating that NCAA embarks on such audits often as required, Nuhu said "So far, nothing to worry about. There is no indication that an airline has issues.”