Domestic Passenger Traffic Slump Exposes Airlines’ Weak Commercial Strategies – Operator

Amid a decline in Nigeria’s domestic passenger traffic, Gbenga Onitilo, the managing director of Travelden, a subsidiary of Finchglow Holdings Ltd, said that Nigeria’s domestic airlines are paying the price for weak, inconsistent, and often absent commercial strategy execution.

The Federal Airports Authority of Nigeria (FAAN) data had shown that domestic passenger traffic declined by 14 per cent from 2022 to 2024.

FAAN figures showed that total domestic passenger movements dropped from 14.52 million in 2022 to 12.54 million in 2024.

Specifically, domestic traffic decreased from 14,519,565 passengers in 2022 to 13,409,701 in 2023, and then further declined to 12,543,153 in 2024.

However, speaking to LEADERSHIP, Onitilo said attributing the decline in passenger traffic to a tough economy, volatile foreign exchange, high fuel costs, and constrained infrastructure is not sufficient.

According to Onitilo, the market did not just shrink, but also exposed structural fragilities that demand spikes and fare hikes had long papered over.

“The 6.46 per cent decline in Nigeria’s domestic passenger traffic in 2024, as reported by the Federal Airports Authority of Nigeria, is often explained with a familiar refrain: a tough economy, volatile foreign exchange, high fuel costs, and constrained infrastructure. All valid. None sufficient.

“The harder truth is this: beyond macroeconomic headwinds, Nigeria’s domestic airlines are paying the price for weak, inconsistent, and often absent commercial strategy execution. The market did not just shrink; it exposed structural fragilities that demand spikes and fare hikes have long papered over.”

“Globally competitive airlines do not merely acquire aircraft; they curate fleets. A harmonised fleet strategy limited aircraft types, predictable maintenance cycles, and aligned crew training, driving cost discipline and operational resilience. In Nigeria, many domestic carriers operate fragmented fleets, mixing aircraft types without scale benefits. The result is inflated maintenance costs, spares complexity, and crew inefficiencies that bleed margins daily.

“When demand softens, such airlines have no shock absorbers. Every grounded aircraft becomes a balance-sheet liability, not a strategic asset.”

Onitilo further stated that several Nigerian domestic carriers operate bloated organisational structures that allow too many people to chase too few aircraft.

“International benchmark practice is ruthless and unemotional, staffing levels are tied directly to fleet size and utilisation. Employee-to-aircraft ratios are optimised for productivity, not sentiment.

“In contrast, several Nigerian domestic airlines run bloated organisational structures, too many people chasing too few aircraft. This is not a moral failing; it is a commercial one. Payroll becomes a fixed cost monster in a business that should be relentlessly variable-cost driven. When traffic dips, airlines with weak staffing discipline have nowhere to hide.”

“Another recurring flaw is route strategy driven by visibility rather than viability. Aircraft are scheduled to “be seen” in certain cities, not because the routes clear their cost of capital. Poor frequency planning, sub-optimal departure times, and thin routes flown without partnerships or feed all erode yields.

“Globally, successful carriers obsess over route economics, right aircraft, right time, and right frequency. In Nigeria, too many routes are flown on hope, not data. Hope is not a revenue management strategy,” he stated.

Onitilo, the former country manager of Afrikfly said it’s time for Domestic airlines to decide whether they want to operate as aviation businesses or flying projects.

“Nigeria’s international and local global players’ airlines operating into Lagos and Abuja from Europe, the Middle East, and Africa, run tightly integrated commercial models. Fleet, staffing, scheduling, and pricing teams communicate with each other on a daily basis. That is why international traffic grew by 6.4 per cent even in a challenging environment. Discipline travels well.

“Domestic airlines must decide whether they want to operate as aviation businesses or flying projects. Yes, the Nigerian economy is tough. Yes, fuel and FX are brutal. But markets do not forgive strategic complacency. The domestic traffic dip of 2024 is not just an economic story; it is a commercial wake-up call.

Until Nigerian domestic airlines adopt harmonised fleet strategies, benchmark staffing models, data-led route planning, and professional revenue management powered by real subject matter expertise, the sector will continue to underperform its potential,” he said.