Nigerian airlines should collaborate to improve their business environment
LEAD Consultant ETIMFRI Group, Amos Akpan has advised Nigerian airlines to think outside the box to ensure the survival of their businesses as some of the challenges facing them will not be resolved by government but by airlines themselves through collaboration in certain areas including fuel distribution, maintenance hangars etc.
Akpan gave his advice to airlines stressing that only by alliances with International organizations can they gain infrastructural and organizational assistance and also urging them to enter agreements with financial institutions to create a payment clearing system for all operators in the industry. According to him, airlines needed to unite and establish an aviation fuel distribution company, build at least one ultramodern maintenance hangar and enter into a working Memorandum of Understanding (MoU) with aircraft manufacturers including Embraer, Boeing, Airbus, and Bombardier.
He said,”Airlines need to unite and float an aviation fuel distribution company to compete with existing ones. They need to set up depots and distribution channels, import/bulk purchase aviation fuel and sell to operators. “Nigerian airlines also need to unite and build one ultramodern maintenance hangar. Invite foreign partners; leverage on themselves as uptakers for the Hanger’s business. Enter a working MOUs with Embraer, Boeing, Airbus, and Bombardier.
“Indigenous airlines should also create a leasing company with foreign investment companies as shareholders. The handling companies, the airlines, the aviation agencies need a lease -hold institution that understands their business modules. “On the lease holding company, it is not the AON members money only”, he explained,” It is investors fund, mostly foreign, that is required. Handling equipments, maintenance equipments, aircraft and Navigation equipments, will form part of the equity. AON should facilitate the establishment of the lease holding company.”
Akpan also canvassed that the airlines needed to be better organized by creating an AON Secretariat managed by non operator. He advocated a secretary, an administrator, and an auditor to manage the Secretariat.
According to him, airline owners and operators should stop dividing their attention between managing AON and the daily operations of their airlines.He also advised the airlines to enter MOUs with financial institutions to create a payment clearing system for all operators in Nigeria’s aviation as well as float an aviation insurance brokerage firm.
“The above subject matters will not be addressed by government the way it is structured. Take the survival of your business as priority. Invite existing international organisations handling each subject listed to partner with AON Secretariat and create the Nigerian aviation version,” Akpan said.
According to him, the need to enter MoUs with financial institutions is now a necessity because the airlines need to accept tickets, waybills, spare parts from each other. This will eliminate unnecessary excess capacity on specific routes, help reduce ground time incurred on turn around maintenance due to the wait for arrival of spare parts, boost customers confidence in their system through the cargo and passenger agents.
ETIMFRI Group Consultant said, “Thinking out of the box is required in the present circumstance. Some people will say they cannot pay their current bills therefore they cannot import or bulk purchase fuel, or form leasing company, or insurance brokage. Some will say they cannot create a financial clearing house because they lack corporate governance. But by alliances with International organizations, they will gain infrastructural and organizational assistance that enables them.
“Do not forget that most of the AON members are IOSA certified which corporate governance and international standard systems are compliant items. Everything comes to ability to access foreign money and equipments at terms that will enable them payback, be profitable and remain in business,” he said.
