Airline operations squeezed as aviation fuel price hit N400 per litre – United Airlines

United Airlines, one of Nigeria’s major domestic carriers has disclosed that airline operations across Nigeria are facing tough times as the cost of aviation fuel (JET A1) has skyrocketed to N400 per litre as against N190 sold February last year.

The carrier further disclosed that the situation is worsened by fluctuation in the exchange rate.

Speaking during a press conference at the Murtala Muhammed Airport, Lagos, Obiora Okonkwo, chairman of United Nigeria Airline, said aviation fuel constitutes 40 percent of airline’s operating costs, and has continued to eat deep into revenues of airlines that barely struggle to stay afloat.

In addition to this, Okonkwo said the current fares charged by many of the airlines are no longer sustainable; as it was no longer able to cushion the effects of the cost of aviation fuel alone, on operators

According to Okonkwo, “For every ticket you sell, you have five percent in the Ticket Sales Charge (TSC) that directly goes to the Nigerian Civil Aviation Authority (NCAA). From the ticket, you pay the Federal Airports Authority of Nigeria (FAAN) and the Nigerian Airspace Management Agency (NAMA).”

He further explained that from the ticket, salaries paid to staff have increased, costs have increased, yet tickets have not increased when compared to the cost of operations.

He therefore suggested that there is a need for special funding for the sector and needs to be given the attention it requires in a bid to save the carriers from extinction.

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He predicted that Jet A1 cost might even rise to N500 per litre before March 2022 and this will definitely force airlines to adjust the ticket price to meet up with cost demands.

“Airline business is the livewire of the entire aviation value chain. If airlines don’t fly or the airlines are in comatose, NAMA, NCAA and FAAN will not get the required revenue to run their operations”.

Okonkwo said the federal government can also support by providing facilities at the airports to allow for longer operation of their equipment, as most airports across Nigeria only operate at sunset operations, which means airlines cannot operate in and out of these airports beyond 6pm.

“There is no support given by the government to airlines that are too big. This is a huge revenue source for the government. Lack of good facilities is making flight delays and cancellations inevitable because many of the facilities have collapsed. Most of the airports only operate in the daytime, thereby putting airlines under tremendous pressure. Sunset airports are killing the industry,” he added.