Except there is intervention and management ingenuity, Nigeria’s local airline, Air Peace, will be priced out of its recently launched Lagos-London-Lagos route as foreign airlines wage price war against the airline.
LEADERSHIP reports that more foreign airlines have drastically reduced their airfares on the Lagos-London route since Air Peace launched its own flight on the route.
LEADERSHIP checks reveal that before Air Peace’s entry to the route, passengers from Nigeria paid N3.5 million for economy class and over N7 million for business class
For instance, a one-way economy class ticket from Lagos to London on British Airways used to cost N3 million for economy class and N11 million for business class. The figures have since dropped to N1.7 million for economy and N6.8 million for business class respectively.
On Lufthansa, a one-way economy class ticket from Lagos to London which also cost about N3 million and N9 million for business class was later put at N2 million for economy class and N7 million for business class respectively.
On Virgin Atlantic, the same destination which used to cost about N2 million for economy, N5 million for economy premium and N12 million for business lass now cost N1.5 million for economy, N3 million premium and N6 million for business class.
Aviation experts, especially travel agents, have, however, attributed the reduction in cost to the entrance of Air Peace, re-opening of lower inventories after clearance of trapped funds by the federal government and the supply of Jet A1 to Air Peace by Dangote Refinery.
LEADERSHIP reports that on Wednesday, Egyptair dropped its Lagos-London economy ticket price further to $470, or N585,620. Air Peace’s London to Lagos trip now goes for ($655) N816, 130, British Airways goes for ($787.99) N981, 848, Virgin Atlantic ($927.99) N1.1m, and Royal Air Maroc ($456.99) N569,422.
Also, RwandAir has pegged airfare to ($545.35) N679,070, Ethiopian Air ($543.84) N677, 824, Turkish Airlines ($647.84) N807, 408, Air France ($915.99) N1.1m, while KLM pegged its price at ($927.84) N1.1m
Wednesday’s ticket prices were significantly lower than it was in the second half of last year and early this year.
Speaking on the crash in prices, the chairman, Air Peace Airline, Allen Onyema, said foreign carriers operating the Nigeria-UK route were reportedly conspiring to send Air Peace out of international operations by crashing airfares on the route.
He alleged that there is an “unspoken alliance” among foreign airlines to use lower pricing to evict Air Peace from the Nigeria-London route.
“If they take out Air Peace prematurely, this country will pay dearly for it, 10 times over; billions will be lost, and there will be another heavy strain on the naira,” he said.
However, in an exclusive chat with LEADERSHIP, the former general secretary of the Aviation Round Table Initiative (ARTI), Capt. John Ojikutu (retd), said the federal government should designate Air Peace as a flag carrier in the absence of a national carrier.
Ojikutu, the chief executive officer, Centurion Aviation Security and Safety Consult, said designating the airline as flag carrier will stop the wastage of the scarce financial resources on commercial aviation services that should be given for concessions, privatisation and commercialisation since 2000.
“Those in the administration of our government and the management of the aviation agencies should designate Air Peace as a National Flag Carrier in the absence of a National Carrier and not to cause the repeat of what happened to those before Air Peace. A national carrier by the understanding of the political office holders in the administration of our government is a government carrier. We have been on this national carrier (government airline) issue for well over 30 years and it has not worked and it will not work, not now and not tomorrow.
“Government should designate two of the airlines as the national flag carriers. i.e, one for regional and continental and the other for intercontinental in order to stop the wastages of the scarce financial resources on commercial aviation services that should be given for concessions, privatisation and commercialisation since 2000,” Ojikutu stated.
However, speaking to LEADERSHIP, the general secretary, Aviation Round Table Initiative (ARTI), Olumide Ohunayo, said Air Peace coming into Lagos-London crashed the airfare on the route.
He, however, called for government support to ensure that more local airlines compete favourably on the international routes.
“It’s good that Nigeria has a carrier on the international route again and we could see the impact immediately as direct flight to London and also other airlines such as Air France, Air Maroc, KLM, all have to adjust their prices. There is nothing good as supporting our own and the need to have more Nigerian airlines on the international routes.
“We have seen the benefit, and one thing is to start and another is to sustain it. So I will advise that there should be schedule integrity and reliability from Air Peace and any would-be carrier. Their frequency must be respected even as they will have to look at partner airlines that can help to move passengers beyond Gatwick or link them to another airport beyond London. That would add more value and bring more passengers to them.”
Ohunayo advised Air Peace and other local airlines to have a reliable and firm schedule and frequency, and to maintain the necessary certification and ensure training to attract more partners and investors.
“I think they should look at their cost and ensure they don’t run into trouble like some other airlines that have gone international before. They are good to go and for the first time, Nigerians supported Air Peace because they are fed up with the frustration of the high fares of foreign airlines which Nigeria felt wasn’t fair.”
Speaking on aero politics on the international route and how Nigerian airlines can survive it, Ohunayo said the government and not the airline has a significant role to play.
According to him, the federal government through the ministry of Justice and Aviation should play the role for the airlines.
“Aero politics is not the responsibility of the airlines alone; the government through the ministry of aviation, the Nigerian Civil Aviation Authority (NCAA), Nigerian Airspace Management Agency (NAMA), all have a role to play. There should be coordination, because there are some tactics that cannot be done by the airline alone, but some of the agencies should respond to the foreign carriers if our airlines are dealt with over there. Our airlines alone cannot handle it but the agencies and ministry of aviation are to give support; even the ministry of Justice and Foreign Affairs.
“The government must be coordinated to battle the aero political part of it,” he stated.
On his part, the former president, ARTI, Dr. Gbenga Olowo, argued that Air Peace has the ability to survive the aero politics amidst price war competition by foreign airlines.
According to him, the challenge is part of the airline’s journey even as he emphasised the need for mature handling.
“It’s part of the politics that they must get ready to handle very maturely and stay off the TV, off the media. It is the challenge of the business and they must be ready to tackle it. It’s expected they will overcome it. The airlines that tried the route in the past, Bellview, Medview, Arik, all had their baptism of fire and they went under, I pray that they (Air Peace and others) will not go under. They should be able to understand the challenges and get ready to handle them very firmly. It’s as simple as that”.
Olowo further advocated government support for the airline in terms of fuel subsidy, even as he highlighted the importance of the carrier’s own efforts in maintaining operations.
“Government has done its very best with the support it gave; that is very good and commendable; it’s now left for the carrier to prove its worth to post on time departures and make sure they sustain the flight,” Olowo added.
