Medview Airline, Nigeria’s flag carrier, disclosed that it would begin its inaugural flight to London on November 20, 2015. While Nigerians are excited about the initiative, the question on their lips is whether the carrier can sustain the predatory competition on the route.
Bold step
Just last week, Nigeria’s flag carrier airline, Medview, disclosed that it had concluded plans to begin Lagos-London route on November 20, 2015. The disclosure was heart warming, indicating that Nigerian airlines are ready to partake in the huge market share.
The Lagos-London route is about the most lucrative route for any Nigerian airline if they apply the right type of model, notwithstanding predatory attitude of mega carriers like British Airways, Virgin Atlantic Airways and a host of other European airlines.
The lopsidedness
The U.K-Nigeria market is currently served on a daily basis by Arik, BA, and Virgin Atlantic. There is an on daily basis demand of an estimated 2,500 passengers a day between Nigeria and UK before looking at connection options, and this has grown at an average annual rate of 9.2 per cent since 2010.
It has become a big problem for airlines in Nigeria because various Nigerian governments have been very generous in giving traffic rights, concessions, designations and entry points to non-African and African airlines alike. Meanwhile, Nigerian airlines are now left with just three per cent of the air traffic market to and from Nigeria. African airlines collectively carry only 20 per cent of the air passenger traffic to and from Africa
Poor market share
Nigeria has the largest economy in Africa as well as the most vibrant air transport market on the continent. It is hard to rationalise and justify why Nigerian airlines have such a small share of their own market. But the fact remains that Nigeria is a signatory to the Abuja Treaty of 2004 under which the Yamoussoukro Decision of 1999, liberalising African skies, is legally-binding.
Nigeria is bound to stand by the Yamoussoukro Accord and honour the Abuja Treaty. There is no doubt, the relatively unknown Medview would face stiff competition from these mega carriers from the UK.
The carrier confirmed it had green light to launch flights between Lagos and United Kingdom and secured slots to Gatwick to introduce four times weekly flights from Lagos later this month. It is understood that the flights will be operated by EuroAtlantic Airlines using a two class Boeing 767-300ER, which was introduced into the Medview fleet in the third quarter and are scheduled to commence from November 20, 2015. The airline intends to break into the London market with a low-fare option for passengers between Nigeria and the UK.
It has already advertised return flights on its website from N149, 000 (approximately £485). “We will make our air tickets to London cheaper without compromising the safety of our passengers who fly the route,” said Muneers Bankole, Managing Director, Medview Airlines when he announced the carrier’ intent to serve the London market.
Not a few welcomed Medview’s bold steps to compete. Time will tell if the airline has what it takes to operate good service on the route. It would be recalled that Nigeria signed a Bilateral Air Services Agreement (BASA) many years ago with the U.K. The pact regulates commercial air transportation between both nations. Under the agreement, Britain and Nigeria agreed that each country would give each other 21 weekly frequencies for their commercial airlines.
BASA controversy
The Nigerian-UK BASA, like others, is based on the principle of equal opportunities and reciprocity. Experts reasoned that,as a result, there is no issue of lopsidedness as alleged by many with the BASA. To them, operationally, Nigeria is unable to meet its capacities of 21 weekly frequencies into two UK points of entry as UK carriers (Abuja and Lagos) due to obvious reasons.
Nigerian airlines can really be profitable if actually they choose to, but there are many factors limiting their growth and expansion including government’s inability to assist them.
Expert’s view
A former Assistant Secretary General of Airline Operators of Nigeria (AON), Mhammed Tukur, said that airlines are the basis of aviation and therefore should serve as the fulcrum of all aviation activities. He added that all policies, programmes and actions of industry stakeholders, particularly policy makers, should be such that would promote the good health of the airlines. Tukur also identified other problems, which include unfair competition and unnecessary monopoly with foreign mega airlines.
This, he said, was made worse by government’s uncaring attitude, exemplified by multiple designations granted to foreign airlines that prevent local carriers from the market; absence of clear government policy on airline business rehabilitation, revamping or revitalisation and the shortfall in technical and economic regulations on the part of the Nigerian Civil Aviation Authority (NCAA).
Conclusion
The contrasting fortunes of Nigeria airlines provide a salutary lesson for Africa’s aviation and political leaders. Evidently, getting it right in the highly competitive, global airline industry depends on key factors such as a sound business plan, shrewd management, competent staff, absence of government interference in commercial decisions, discipline of the private sector, careful selection of strategic partners and a lot of luck.
