To eliminate the existing near-monopoly where two airlines are dominating the domestic services, the Federal Government is facilitating the registration of four additional airlines, which would fully commence operation by next year.
The Nigeria Civil Aviation Authority (NCAA) has been urged to register airlines that met outlined conditions without impediments or delays as Nigerian air passengers are suffering and paying exorbitant fares for local travel.
Since Dana Air was grounded in June and First Nation Airways stopped operation, air fares have skyrocketed and people scramble to buy tickets and sometimes have to bribe their way to get seats in flights, especially in Abuja where touts hold sway and at peak periods fares could rise as high as N40,000 for one hour flight.
Although it is expected that Dana Air would resume operation by end of October and Med View Airlines, which recently joined scheduled air operation, would also resume this month but these airlines have few aircraft in their fleet so they would not have enough capacity that could help to cut down the fares.
Presently air transport is the costliest in Nigeria, which is the highest in any peaceful country in the world and why this is considered anti-development is because the country has a safe airspace with modern instrument landing system and radar and the high cost of fuel is not peculiar to Nigeria.
An industry insider told THISDAY on Wednesday that if government carries this plan out it would encourage the development of the domestic market and sharpen competition among the domestic carriers and of course, knock down fares.
“In the last few months the situation has been dramatic due to the grounding of Air Nigeria, Dana Air and when Arik stopped operation for three days Aero’s lack of capacity led to the suffering of passengers.”
The source said that Nigeria is quickly losing the West and Central African market to Asky and Kenya Airways which now operate as local airlines in the region because it is only one Nigerian airline that operates in the sub regional routes.
“Also in the domestic routes Arik and Aero can be described as a duopoly because of their relatively higher capacity. IRS does not have the capacity now so if anything happens to one of its aircraft it will shut down its routes like when that truck damaged its flight on Wednesday.”
The source said that it would be a welcome development if government would encourage the establishment of more airlines, “as long as the issue of effective regulation is there.”
Also by next year the Ministry of Aviation must have concluded plans to give single digit long terms loans to airlines to assist them to acquire aircraft.
It has outlined plans to assist the operators, including those that have temporarily stopped services, to acquire modern aircraft from manufacturers and lessors with funds that would be made available by that arrangement.
This fund, THISDAY gathered, would be provided solely for aircraft acquisition and the bank and the Ministry of Aviation would monitor its disbursement and the acquisition of the aircraft.
At this moment the Dutch airline brand development and design company Lila Design Associates is assisting a new-entrant Nigerian airline.