Why Cheap Flights Remain Out of Reach in Nigeria’s Aviation Market
The prospect of cheap flights in Nigeria is hampered by a complex web of structural, operational, and regulatory challenges that go far beyond airline pricing strategies. According to former Director General of the Nigerian Safety Investigation Bureau (NSIB), Mr. Akin Olateru, the high cost of airfares is rooted in deep-seated issues that affect every aspect of the aviation value chain.
One of the most significant barriers is the foreign exchange exposure faced by Nigerian airlines. While tickets are sold in naira, up to 90% of operating costs—including aircraft leasing, maintenance, and insurance—are denominated in foreign currency. This currency mismatch leaves local carriers highly vulnerable to exchange rate fluctuations and makes it nearly impossible to offer low fares, especially when compared to airlines in the US or Europe that operate within a single currency environment.
Compounding this is the high cost of borrowing in Nigeria. With interest rates hovering between 30% and 35%, airlines face enormous financial pressure. Such rates are unsustainable for any capital-intensive business, forcing operators to pass these costs directly onto consumers through higher ticket prices.
Maintenance and spare parts present another major hurdle. Many Nigerian airlines are forced to keep one aircraft grounded as a source of spare parts due to the difficulty and delays in importing components. The process is further complicated by foreign exchange restrictions, lengthy customs procedures, and port bottlenecks, all of which extend aircraft downtime and erode profitability. In some cases, planes may be out of service for up to 20 days, significantly reducing fleet utilisation and driving up costs.
Infrastructure limitations also play a role. Delays in passenger processing, especially for early-morning departures, increase operating costs and reduce efficiency. Airport facilities and support services often lag behind international standards, further constraining airline operations.
On top of these operational challenges, the tax and regulatory burden on Nigerian aviation is substantial. Passengers face a \$100 passenger service charge, value-added tax, a five percent ticket sales charge, a \$20 security fee, and other levies, pushing the base cost of an international ticket to around \$250 before airlines even set their prices. Regulatory requirements, such as restrictions on aircraft age, also drive up acquisition and operational costs.
Broader economic pressures—such as country risk, high insurance premiums, and limited foreign direct investment—further exacerbate the situation. The cumulative effect is an ecosystem where airlines cannot absorb costs and must transfer them to passengers, making cheap flights unattainable for most Nigerians.
While airlines are often blamed for high fares, Olateru and other industry experts argue that the real drivers are systemic: finance, regulation, infrastructure, taxation, and policy. Addressing these foundational issues is the only sustainable path to more affordable air travel in Nigeria, and until then, the dream of cheap flights will remain elusive for the vast majority of the population.
