By Kenneth Ehigiator
The Federal Government has expressed reservation over the low promotional fares charged by some domestic airlines in the country, saying such a practice was undermining safety.
Aviation Minister, Mr. Babatunde Omotoba, who stated governmentâ€™s worry over the development while commissioning NIMETâ€™s automated weather forecasting system in Lagos, yesterday, added that government was planning to meet independent oil marketers over recent increase in the price of aviation fuel, otherwise known as JET-A1.
According to him, it is impossible for airlines to charge between N5,000 and N9,000 per an hour flight and be able to carry out safe operations.
Explaining the dynamics of airlinesâ€™ fares in relation to a safe operation, Omotoba said: â€œ Letâ€™s take an airline that is advertising N5,000 fare from Lagos to Abuja, with 116 seats on board. Letâ€™s assume that the load factor is low and is getting 100 people to fly. With that, you are talking about N500,000, which is about $3,400 on an hour flight to Abuja.
â€œAn average aircraft, B737, will take 3,000-4,000 litres of fuel at about N90 per litre, and that will give about $2,100. If you take that out of $3,400, thatâ€™s $1,300 left. The total cost of operating that aircraft, including lease, insurance and all of that is about $9,000 for every one hour flight.
â€œBesides, you also need to leave about $500 reserve for every one hour flight for maintenance, that is $9,500, so take that from $1,300, that airline is going to be losing $8,000 for every one hour flight. I donâ€™t know the rationale for these promotional fares.â€
The minister explained that government was worried about the low fare regime because the aviation industry carries the intellectual capacity of the country, stressing that that informed the reason it was determined to achieve the goal of zero-accident rate.
He said at N20,000 per one hour flight, airlines would be able to take care of their operational costs and still make an average of $2,000 from every one hour flight.
â€œIf we have reduced the number of airlines that can cover their cost, Nigerians will be safe, travellers will be safe, because we are not only carrying Nigerians. It is better that saying drop price..drop price and the airlines begin to compromise safety. That is what we donâ€™t want,” he added.
â€œThat is why I tell you that some of these adverts Iâ€™m not in support of them Though I canâ€™t stop them. I just feel that they (airlines) are kind of shooting themselves in the foot,â€ the minister said.
Omotoba said he would soon meet with independent oil marketers on the need to scale down the price of aviation fuel, which they only recently increased after the intervention of the House of Representatives Committee on Aviation.
He, however, said a reduction in the price of fuel would not guarantee low fares because of other operational cost.
Speaking in the same vein, Director-General of Nigerian Civil Aviation Authority (NCAA), Dr. Harold Demuren, described the promotional fares charged by domestic airlines as a gimmick, which could hardly cover their operational cost.
He spoke of the resolve of the NCAA to step in to ascertain if the airlines involved were paying all their charges when due.
â€œNCAA will come in in pre-emptive fares. We want to know, are they paying their bills? Are they paying landing and parking charges? Are they paying salaries, insurance and other bills? Demuren queried.