Airline Operators of Nigeria (AON) have offered reasons for raising the cost of economy flight ticket to a minimum of N50, 000 across Nigeria.
At a meeting held in Lagos which had most of the domestic operators present, the association cited the high cost of jet A1 fuel, forex scarcity, double digit inflation, increase in ground handling charges, cost of buying and bringing spare parts, among others as reasons for the increase.
It was gathered that at the meeting, most of the operators were in agreement that the benchmark for economy ticket should be pegged at N50, 000 to most routes but that Green Africa, whose business model is that of a low-cost carrier was not in total support.
At a recent meeting with aviation reporters in Lagos, Obiora Okonkwo the chief executive officer of United Nigeria Airline hinted at the possibility of increasing flight tickets due to the high cost of operations.
Okonkwo said that a year ago, aviation fuel was sold at N190 per litre, but that the cost has risen to N400 per litre and that considering the fact that fuel takes up at least 30 percent of operation cost, many airlines will struggle if there is no price adjustment.
“The least ticket we sold a year ago was N23, 000 when aviation fuel was N190 and the official rate of naira to a dollar then was N340, but today, if forex is available, it is N450 but when it is not available, the alternative market is N570 to a dollar.
“Despite this, you can still buy your ticket at N20, 000 to N21, 000 and what this means is that as long as all the airlines are buying from the same market and selling tickets at the current rates, any ticket that you buy is being subsidised by the airlines. Aviation fuel, depending on the aircraft type you are flying, could take up to about 30 to 40 percent of your cost components.”