By Dickson Omobola

Mixed reactions have trailed the announcement by President Bola Tinubu that aircraft manufacturer, Airbus, has proposed establishing a maintenance hangar facility in Nigeria.

The reactions ranged from commendation, given the employment opportunities the project could create for Nigerians, to outright criticism by experts in the air transport sector.

Some experts, however, refuted claims that the country’s aviation industry was not viable for such investments, saying Airbus would not have shown interest if that were the case.

A few days ago, presidential spokesperson, Mr Bayo Onanuga, disclosed the proposal in a statement, saying discussions held with the aircraft manufacturer also covered aircraft leasing and financing models, including export credit arrangements, sale-and-lease-back structures and long-term financing solutions aimed at improving airlines’ access to aircraft.

Benefits

Speaking to Saturday Vanguard on the issue, General Secretary of the Society of Licensed Engineers of Nigeria, SLAMEN, Sheri Kyari, said if realised, the benefits would be numerous.

According to him, hangars were not just the visible facilities, but also include workshops attached to them for servicing critical aircraft components.

Kyari said: “Physically, you would have started arranging for a space for manufacturing of aircraft components, which will ultimately lead to the manufacturing of full aircraft. There will be demand for labour, thereby creating employment opportunities for thousands of workers in such facilities.

“Also, the cost of doing aviation business for airlines would reduce significantly because they will be doing their maintenance at home. When you take an aircraft outside of this country for maintenance, you are going to pay for over-flight charges, burn fuel, you are going to pay for parking and landing, meaning a lot of money would be spent. So, it is of utmost importance to have this facility, and we hope that it comes into the country as soon as possible.”

On whether the market was large enough, he said: “Yes, it is. If the market is not large enough, even Airbus would not talk to Nigeria. Once there is a standard maintenance facility, you are looking at West Africa market, Central Africa and perhaps even if there is undercapacity in Europe, they will come here.

 “For instance, some airlines take their aeroplanes to Ethiopia for maintenance. Some of these airlines are European for that matter, and that is because there is capacity. So, if we have, it is going to be a plus for us, seriously.”

Worry

For his part, Chief Executive Officer of Centurion Aviation Security Limited, Group Captain John Ojikutu, retd, said: “Who are the people that are going to do it with Airbus: is it the presidency? There must be companies here that are going to partner with Airbus to do it, not government. When they do this type of thing now and there are debts, who is going to pay the debt? Is it government?

“These are businesses that have nothing to do with government. We have to think seriously. Those who have set up an MRO here are the ones that should be working with Airbus. How many airlines do we have within the region, especially in Togo, Cameroon and Ghana? How many airlines are using Airbus that you want to do it with? That is why I always tell them, what is your business plan? Aviation is not groundnut and popcorn selling. Aviation is a business where you invest dollars.”

Also, former rector of the Nigerian College of Aviation Technology, NCAT, Zaria, Capt Samuel Caulcrick, said one of the challenges of establishing MRO facilities in emerging economies like Nigeria was that investors require guarantees that local airlines would patronise such facilities before committing huge capital to the project.

He said: “Financial realities necessitate incentives for mandated domestic maintenance before investors commit to establishing an MRO. While MROs often claim higher profit margins than passenger airlines, realising these margins in an emerging market is challenging due to heavy investments in tooling, certifications and skilled personnel. 

“To overcome these barriers, governments and aviation authorities typically offer various support measures such as tax and duty waivers, removal of customs duties on spare parts and zero-rated VAT, along with stamp duty exemptions, designation of the MRO as a pioneer industry to enable tax holidays and financial relief and permitting the operation of bonded warehouses reduces holding costs for expensive components.

“However, strategic steps for establishing a sustainable MRO require assurances beyond mere mandates. They involve comprehensive business plans detailing how to develop Free Trade Zones at airports and forging partnerships with OEMs, both of which are crucial.”

Meanwhile, an industry person who did not want to be named told Saturday Vanguard that Airbus was not about to develop an MRO in Nigeria.

She said: “Airbus are not in the business of MROs. They are an Original Equipment Manufacturer, OEM. Both Boeing and Airbus have no MROs. They have consulting units that can help airlines do MRO business planning.”