Airlines suffer low load factor over price hike

Airlines operating in Nigeria are experiencing very low load factor as passengers shun flights as a result of increase in air fares.

Last week, most domestic airlines operating in Nigeria increased economy flight tickets prices for domestic routes from about N30,000 to a base fare of N50,000.

The airlines include Air Peace, Dana Air, Azman Air, Max Air, Ibom Air and Arik Air.

At a meeting held in Lagos on Tuesday last week, the airline operators cited the high cost of jet A1 fuel, forex scarcity, inflation, high ground handling charges, cost of importation of spare parts among others as reasons for the increase.

Low load factor means an airline has empty planes with most seats not occupied by passengers. Since airlines have high fixed costs associated with each flight, a low load factor could translate to lower profit or total loss for the airline.

Read also: Why we raised domestic flight ticket to N50,000 – Airlines

Since the increase in fares, airlines have experienced very low bookings across frequently travelled destinations such as Abuja, Lagos, Port Harcourt, Owerri, Asaba, Enugu, Kano and Kaduna.

Gina Ogwo, a travel agent, told BusinessDay that airlines are seeing 50 percent load factor or below on most of the routes and this may continue as long as airlines refuse to bring down ticket prices.

A passenger with twitter handle @Furwriter who had taken a flight early Tuesday had taken of himself on an empty flight and uploaded.

“Just look how empty a morning flight is. N50,000! One hundred percent increase in air tickets. We are finished in this country,” the passenger tweeted.

“From Delta State to Lokoja is N300 by train. From Lokoja to Abuja is N2,500 and that is a total of N5,500. Tell me why I should spend an extra N44,500 on a flight that will delay me at the airport,” a passenger by name Mike Damini stated on his twitter handle on Tuesday evening.

Patricia Ray Gukas, another passenger tweeted: “a round trip now is N100,000. I wanted to book a trip yesterday but I changed my mind after I saw the rate.”

One airline operator said the low load factor is just for a short time, as he was sure after a few weeks passengers would return, adding that rising prices is a reality not an exploitation.