Ownership structure of domestic airlines unattractive to technical investors–Ojikutu
Leading aviation expert and industry stakeholder, Group Captain John Ojikutu (rtd) has provided a clear insight on the main factor frustrating the expected growth in the domestic aviation sub-sector of the economy in recent times.
In an interview in Lagos, he explained that the indigenous airlines have single ownership template that hardly creates any attractive window for either technical or fleet investors to join in the expansion of existing company.
The trend, according to him, opens up the way for either failure or gradual contraction of airlines few years after effective takeoff of operations.
He said the matter is further made worst by the traditional Nigerian traders or businessmen mentality of owner-occupier which does not encourage financial injection by any prospective investment partner to be part of an existing airline business.
Continuing, Ojikutu averred that several business plans of most of the airlines had no bearing with the reality of their operations, thus, creating terminal squeeze that always end up seeing the airline in huge debt crisis.
The Managing Director of Centurion Security also argued that shrunk because of lack of loose money, which many of the ‘so called investors’ in the country were used to.
Ojikutu noted further that “The Nigerian Civil Aviation Authority (NCAA) enforcement of the economic registrations is not effective and regular; therefore, gives room to many airlines unhealthy financial status.
“There had been over 50 Nigerian airlines operators in the last 35 years excluding the Nigerian Airways and to some extent Aero, but their effective operational lifespan is less than five years after, which they begin one type of stress or the other due to the reasons given above.
“Aero is one example of this single ownership syndrome that became stressed less than three years the technical partners in the airline withdrew their investment. We also got to the level of four airlines out of many because of the reasons given above, but how many of the four remaining are viable?” he queried.
To him, passengers across the country are stranded at airports not because there were no aircraft, but because of poor management of utilisation of capacity.
He revealed further that two of the four airlines flying now had between them about 30 new or modern aircraft in their fleet, but queried the number of the aircraft that are in the air.
Making reference to the defunct national carrier, he recalled that Nigerian Airways at a time never had as much aircraft as some of the present airlines, but covered more domestic and international routes than all the present airlines put together.
Accordingly, he averred that “For as long as there are problems of single ownership owned in the Nigerian commercial aviation, and the airlines are not ready to interlining or co-sharing and there is no efficient way to utilise capacity, the air travelling passengers will suffer the fate.
