Escalating Airfares In Nigeria

Nigerians, who are privileged enough to afford air travel, are currently battling what many have described as an inexplicable rise in ticket costs. For them, this is worrisome. The price of a one-way ticket for a flight of about an hour is as high as N500,000.

If travelling by air used to be a luxury in the past, it is no longer. Insecurity and the deplorable condition of the roads have made travelling by air a necessity for many. Most Nigerians believe the choice is between flying or travelling by road, and being vulnerable to kidnapping.

The seemingly intractable insecurity in the country has led to a surge in the number of Nigerians travelling by air. However, it seems that this growth is at risk of decline due to higher ticket prices.

This steep rise in ticket prices, which, according to reports by the National Bureau of Statistics (NBS) has reached as high as 57 per cent in October 2024, is making air travel unbearable for many Nigerians.

Ironically, air passengers in Nigeria pay more for services that are often inferior or similar to those provided by their counterparts in other African countries or Europe.

Why is Nigeria witnessing an astronomical rise in the cost of air tickets? What measures could be taken to ensure a drop, if not an outright crash, in the price of tickets?

The persistent increase in airfares is caused by various factors, including multiple taxation, inflation, and currency fluctuations due to the nation’s highly volatile exchange rates, which negatively impact the cost of aircraft parts, maintenance, and aviation fuel, all of which are largely imported.

Other factors contributing to these seemingly  unaffordable ticket hikes include the high cost of aviation fuel, among others. Inflation has increased operational expenses for airlines. To make a profit or at least break even, operators increase ticket prices. It is that simple.

Why should the nation not see a steady rise in air ticket prices when we are experiencing a volatile exchange rate of the naira, which impacts the cost of imported aircraft parts, maintenance, and aviation fuel (Jet A1)?

Recently, there was a media report that the nation’s aviation sector is battling about 54 taxes and charges comprising aeronautical and non-aeronautical revenues.

Understandably, these taxes and charges are typically passed on to passengers, resulting in the steep increase in airfares. The natural question to ask is, who imposed those taxes?

Disturbed by this steep increase, which directly impacts members since most of them travel by air, the Nigerian Senate summoned the Minister of Aviation and other key stakeholders.

The lawmakers criticised the airlines for the steep price hikes, pointing out that there has been no corresponding increase in aviation fuel or airport charges. They even dismissed claims that the high cost of spare parts justified the fares, noting that many airlines operate aircraft that are over 30 years old.

One thing is certain: this astronomical rise in tickets will eventually harm the sector, as it will result in fewer passengers for the airlines.

Should the Nigerian government not intervene? We are aware that since the aviation sector has been deregulated, the Nigerian government cannot interfere in how airlines determine airfares. However, something urgently has to be done.

If rising operational costs, including multiple taxes, are part of the reasons for the steep increase in tickets, the government must intervene by restructuring these taxes and addressing the factors responsible for the increasing operational costs.

Already, rising ticket prices are significantly impacting airlines, as many Nigerians are now opting to travel by car rather than flying, and local airlines are experiencing a decline in ticket sales. If this trend continues, some airlines may be forced to negatively adjust their operations.

The nation’s aviation sector has experienced notable improvements, including infrastructure upgrades aimed at boosting safety, efficiency, and the passenger experience.

We remember that in August 2024, Nigeria signed a Memorandum of Understanding (MoU) with Boeing for technical support, aviation training, and the development of local Maintenance, Repair, and Overhaul (MRO) facilities. This marks a vital step towards reducing reliance on foreign service providers. Nigeria also signed new Bilateral Air Service Agreements (BASAs) with the United Arab Emirates, the United Kingdom, Jamaica, Namibia, and Canada.

All of these efforts will be futile if Nigerians are unable to travel by air due to affordability issues. Stakeholders must make concerted efforts to tackle the rising cost of airfares. The time is now.