Airlines struggle as losses hit N150bn in two months

Airline Operators of Nigeria have raised alarm over losing N150bn within two months, even as ground handling companies threaten further action over about N9bn in outstanding debts.

A member of the Board of Trustees of the Airline Operators of Nigeria, Roland Iyayi, said airlines had lost over N150bn in just two months, stressing that operators were nearing breaking point.

“Airlines have bled over N150bn in two months. Where is the money going to come from? It’s gotten to a point where nobody can threaten anybody any longer,” he said.

Iyayi warned that the survival of ground handling companies depends largely on the existence of airlines, adding that the current standoff could have dire consequences.

He said, “If airlines don’t exist, they don’t have a business. Nobody cares about the airlines; everybody wants to collect money. We’ve made up our minds now that whatever anybody wants to do, they can continue, but I can guarantee you that at the end of the day, everybody will come to their knees. You can’t force anybody to come up with what they don’t have.

So that’s where we are right now.”

He further cautioned that any disruption to airline operations would ultimately hurt all stakeholders in the sector. He added, “They threaten, the same way a few marketers are saying cash and carry. So let’s see what happens by the time airlines stop flying, whether they have any business.

“There’s no way airlines can do anything regarding any debt, simply because it has become very difficult to survive. Airlines are struggling to survive. So anybody threatening airlines now to say, ‘Oh, if you don’t pay up, we’ll cut services,’ without the airlines, you don’t have any business. So if you make it seem like you are doing the airlines a favour, no, it’s the other way around. Without the airlines, you can’t be where you are.

“What are we meeting for? To make promises we can’t keep? If anything at all, the airlines have to survive first before the ground handling companies can even have any future as a business,” he added.

However, the Chairman of the Aviation Ground Handling Association of Nigeria, Olaniyi Adigun, said the association was considering its next line of action in line with labour laws.

“What we intend to do is to come out with a press conference, and according to Nigerian law, we have our own strategy, which we are meeting together, and we are going to state our next move. Although some of them (airlines) have started, the majority have not. But that does not call off the strike,” he said.

Adigun added that the association might escalate its action if airlines fail to meet its demands within the stipulated timeframe.

“However, you know in the labour law, when you give a seven-day notice, and if you don’t meet up, you can give a three-day notice. So that’s the labour law; we are trying to look at that.

“But we have our minds set. We are just following the law. So after the expiration of seven days, if we don’t hear from them, we have our own strategy. We will be having a meeting on Thursday. So let’s wait for the outcome of the meeting,” he said.

Meanwhile, another member of the Airline Operators of Nigeria, who spoke on condition of anonymity due to the lack of authorisation to speak on the matter, urged caution, warning that the timing of the dispute could worsen the country’s fragile economic situation.

“This is not even the right time for anybody to be attacking the airlines or for the people that are attacking each other, because this is a difficult time for them. So I don’t think this is the right time to do that. It’s a very sensitive period,” the source said.

The source warned that the collapse of airlines would trigger widespread consequences across the country. “As a nation, we cannot afford for our airlines to go down now because it’s going to create a lot of problems. There are a lot of problems we cannot afford. We’re in a very, very difficult position as a nation.

“If airlines go under, there will be an uproar in this country. So we have to be very careful. So I think the ground handlers will need to be patient and find a way to meet with the airlines, get into a dialogue because dialogue is the only way forward,” the source added.

The development follows an earlier report by The PUNCH that a fresh crisis was brewing in the aviation sector after ground handling companies threatened to suspend services over more than N9bn owed by domestic airlines, raising fears of widespread flight disruptions across the country.

The ground handlers, under the umbrella of the Aviation Ground Handlers Association of Nigeria, had issued a seven-day ultimatum to airline operators, warning that failure to settle the outstanding debts could force them to withdraw critical services essential to flight operations.

The association noted that the lingering indebtedness had placed significant financial strain on its members and affected their operational capacity, adding that repeated efforts to recover the funds had yielded little progress, with airlines’ payment commitments largely unmet.