Aero as Nigeria’s Flag Carrier?

If the news making the round that Aero Contractors is set to be named Nigeria’s ‘National Carrier’ is true then the aviation industry is in the precipice for bigger crises.

According to recent reports, to pave way for Aero’s emergence as the nation’s flag career, AMCON (Asset Management Company of Nigeria) is currently undertaking a valuation of Air Nigeria assets, which would be concluded in the next 30 days, following which they will be offered to Aero Contractors to expand its operations. This has got to be a very bad joke!

Before I even get into the criteria upon which the choice of Aero as national carrier might have been based, may I ask ‘which Air Nigeria asset is AMCON valuing?’ Is it the same asset that has reportedly been sold to new airline, Discovery Air, by ruthless businessman and serial airline killer, Jimoh Ibrahim? This government is definitely clueless about the business of aviation!

Just so you appreciate why this news (if true) is unsettling, aviation reporter with Thisday newspaper, Chinedu Eze, explains, in simple terms, the concept of a national carrier and the perks the airline so designated would enjoy in his report published in the October 21 edition of the publication:

“As a national carrier, Aero Contractors is expected to enjoy preferential rights or privileges accorded by the federal government for international operations. It would hold some lucrative routes in monopoly, negotiate commercial agreements, pools and bilateral agreements with foreign airlines, articulate manpower training for the sector and serve as diplomatic tool for Nigeria.

“Designating Aero Contractors as the national carrier would also allow the airline to code-share with other international airlines, as this would improve Nigeria’s ability to take advantage of Bilateral Air Service Agreement (BASA) it has in place with other countries.”

While there is nothing fundamentally wrong with the concept of a national carrier (as many countries the world over boast of one) the rationale behind the emergence of Aero as Nigeria’s flag carrier is questionable. The argument that the airline may have been selected for the role because of AMCON’s 60 per cent stake in it just doesn’t suffice!

As far as I know, Legacy Holdings, a company owned by the super rich Ibru family, will hold a 40 per cent stake in the national carrier and, just as Jimoh Ibrahim did with the finances of defunct Air Nigeria, will continue to enrich themselves with the connivance of corrupt government officials, at the expense of Nigerians.

Reports also have it that there is a plan to offload 10 per cent of the designated national carrier to a facilitator suspected to be a top government official in the aviation sector. What do we call this? Another avenue for more ‘over-inflated’ bullet-proof cars and luxury jets to be bought with public funds, for private use?

Granted, other airlines have debts too with Arik the largest debtor by miles (the airline owes AMCON up to N180bn, and doesn't pay a kobo to them. It also owes about N10bn to NCAA and FAAN not to mention its debt to numerous other suppliers). But is Aero the best Nigerians deserve given its fleet size, age of its aircraft, quality of service, management style e.t.c?

Talking about fleet size, Aero has 16 aircraft (mostly Boeing 737s) with an average age of 22yrs while Overland has 6 ATR aircraft; Dana Air 5 Boeing MD83s; IRS 5 Fokker 100s; and Medview 3 Boeing 737s, all of similar age as Aero’s. Only Arik has more aircraft (a total of 22 comprising Boeing 737s and Airbuses) with average age less than 7years.

On quality of in-flight service/customer service, Dana Air ranks highest while Medview follows; Aero and Arik sit at the bottom in this area. This is also the picture when it comes to corporate governance and effective management of the airlines.

Putting all of the above into consideration, one wonders what sets Aero apart from other operators to merit the national carrier status? Based on financial health, equipment and performance is it not also puzzling that some airlines are allowed to fly while others remain grounded? Or does the NCAA have a different yardstick for airlines operating in the country?

If there were any doubts regarding the theories that the selective grounding of smaller airlines like Dana Air, IRS and Chachangi is a calculated attempt to kill these airlines and pave way for madam Minister’s planned ‘national carrier’ then the latest news about Aero, in spite of the mismanagement and huge debt profile of its promoters, confirms the conspiracy by the powerful oligarchs and conniving politicians to continue to rob Nigerians, unabatedly!

As I stated in my earlier article, the potential in Nigeria’s aviation industry is huge but, to turn this immense potential into real prosperity and progress for our country, we must begin to do things the right way, leaving sentiments and personal interests aside.

The aviation industry is a highly technical and professional sector, and full compliance with standard procedures and regulation must be ensured. Airline operators must become more accountable and aviation agencies more thorough and professional in their oversight function and provision of statutory services, divorced from all political interests.

Emeka Gbulie, an Investment Advisor, writes from Lagos

I feel Arik airlines would make a better national carrier than any oda airlines in Nigeria