Aviation industry players in Nigeria have expressed concern that the sector may soon collapse if current trends are not immediately halted.
Industry stakeholders are growing anxious as a result of the ongoing increase in the price of aviation fuel, also known as jet A1, as they express concerns that the sector may collapse and there may be significant job losses if the rising price is not reined in. According to estimates as of Friday, the price of Jet A1 fuel had increased from approximately N300 per liter in February to approximately N1,000 per liter, leading to a huge increase in ticket prices.
What’s the link to a potential collapse?
There’s been a continuous decline in demand as many passengers have stopped flying. And according to Capt. Roland Iyayi, former Managing Director of the Nigerian Airspace Management Agency and Chief Executive Officer, TopBrass Aviation Company Limited, this low demand presents a serious threat to the continued existence of airlines and the aviation sector. This concern is real as two airlines have already halted operation, and it is feared that others may soon follow. They’ve called on the government to intervene immediately.
What sort of intervention are they looking at?
They’ve appealed to the government to examine the port fees and taxes on aviation fuel and determine whether they may be temporarily suspended until the price of the fuel returns to normal. Aero Contractors announced on July 18 that it was ceasing operations, due to the impact of the difficult operating environment on its activities. Two days later on July 20, Dana Air’s operations were also suspended by the Nigerian Civil Aviation Authority. Aviation Round Table, a body of professionals in the sector, has said more airlines may soon follow.