Finance

November 12, 2012

New airlines: Fadugba urges FG to consolidate existing domestic airlines

As more new domestic airlines are expected to start their operations in Nigeria soon, a former Secretary-General of African Airlines Association, AFRAA, Mr. Nick Fadugba has said that instead of allowing new airlines into the aviation industry, the Federal Government should consolidate the existing domestic carriers saying that, that was the practise all over the world.

Mr. Fadugba who stated this development at the stakeholders’ forum organised by the Federal Airport Authority of Nigerian ,FAAN, pointed out that most of the domestic airlines that we have at the moment are weak, underfunded and under-capitalized adding that the only way to make them vibrant was to consolidate them.

He said”the airlines are our weakest links at the moment, apart from Arik Air, we don’t have any large, strong airline in Nigeria. Most of the airlines are weak, underfunded and under-capitalised. I hear they are planning for new airlines, I would encourage the government to exercise caution because all over the world airlines are consolidating even in China too.”

Mr. Fadugba however stressed that with the current situation on ground in the aviation industry, if new airlines are created, how would they all survive adding that instead of bringing in new airlines  the government should focus on the few existing ones and make them very strong so that they could compete favourably with their other counterparts in other parts of the world.

”Instead of bringing in new airlines, we should not focus  on many but the few strong, profitable, affordable, safe airlines, rather than having many” he said.

He further caution the government to be mindful before signing any agreement with those incoming domestic airlines stressing that only agreement that are in Nigeria’s favour should be signed.

”Before we sign deals we should ensure they are in Nigeria’s favour, there have been so many deals that have been signed from Maevis, to Virgin to Bi-Courtney, deals that have been signed by government but were revoked because they had wrong intentions and a few years down the line we find out the deals are not in favour of Nigeria and we terminated it but already these are signed deals”.