– African airlines lost $8.6bn in 2021
– Nigerian passengers suffer airfare hike
– European countries lower travel protocols
– Airlines are exploiting Nigerians – expert
AVIATION stakeholders have expressed mixed outlook for air travel in 2022 in the light of lower passenger volumes last year, aviation fuel scarcity and hike in air fares lately.
Aviation experts who spoke to The ICIR in a series of telephone interviews noted that the industry was still recovering from the 2020 COVID-19-induced lockdowns but still held promises for this year, and even beyond. Some others have, however, expressed their reservations.
Countries like the United Kingdom, Singapore and Kuwait have begun to find ways to relax their travel restrictions, with the UK becoming the first major Western nation to officialise the need to ‘live with COVID-19.’
Canada also hopes to lift its blanket travel advisory and the requirement for pre-departure COVID-19 molecular testing by February 28, 2022.
Vice President of the National Association of Nigeria Travel Agencies, Lagos Zone, Yinka Folami, predicted that air travel would rebound in the second quarter of the year.
Folami said, “Obviously, this year looks more promising on commercial outlook. The most important thing is for the COVID-19 and the variants to stabilise. I am personally positive that by the time we get into the second quarter, travel would be back to full activity.”
The African Airlines Association (AFRAA), in its overview of airlines’ performance in 2021, said that infection of the Omicron COVID-19 variant reduced the future of travel in 2021. According to its report titled, ‘African Airlines Performance Updates – January 2022,’ Africa passenger volumes dipped exponentially last year. AFRAA reported a full-year revenue loss of 2021 at $8.6 billion for the continent’s airlines.

Part of the report reads: “Across Africa in general, passenger traffic volumes remain depressed due to the unilateral and uncoordinated travel health restrictions imposed by some governments following the outbreak of the Omicron variant of COV-2.
“Airline revenues have remained low with many operators battling with cash-flow issues. Full-year revenue loss for 2021 is estimated at US$8.6b, equivalent to 49.8 per cent of the 2019 revenues. In 2020, African airlines cumulatively lost $10.21b in revenues due to the impact of the pandemic, representing 58.8% of 2019 revenues.”
Hope for airlines
An aviation consultant Olumide Ohunayo told our correspondent that the aviation industry could recover in 2022.
Ohunayo posited that 2021 was not a good one for air travel, with Omicron and COVID-19 protocols negatively affecting the industry.
“Year 2020 was worse, 2021 wasn’t good either. We should begin to recover this year as everyone is doing away with the barriers inhibiting travel, like the COVID-19 testing. It has not been good for airlines, especially on international routes,” he said.
On February 17, 2022, the International Air Transport Association (IATA) released data showing growing momentum in the recovery of air travel as restrictions are lifted.

The clearing house for over 290 international airlines, in a report made available to The ICIR, stated carriers were seeing improved ticket sales.
The airlines’ representative reported a sharp 11-percentage point increase for international tickets sold in recent weeks, in proportion to 2019 sales.
Bleak future for Nigerian aviation
While hope seems to be on the horizon for international travel, the future seems to be a little bleak for Nigerian carriers. AFRAA asserted in its report that the domestic market maintained the biggest share for capacity growth, with demand at 42 per cent outperforming intra-Africa and intercontinental routes in 2021.
This share, experts fear, could be threatened with the hike in airfares in February 2022.
A social worker in the Northeast Robert Ogbogu admitted that the fare rise was a strain on an already tight budget.
Ogbogu said, “Interestingly, a lot of aid workers are supporting recovery and development in the North-East, and because of the fragility of the communities we work in, it is always difficult to have our families with us. We are highly mobile and air travels provide us with the opportunity to go home as road trips in Nigeria can best be considered an extreme sport.
“The new fare will occasion hardships on our already tight budget. The stack and risk might be higher for us.”
Similarly, a top-level official in Abuja Angela Umoru admitted that flying was a luxury. “I am even scared of flying now. It’s too expensive,” Umoru said.
Hike on air fares
Checks by The ICIR on Dana Air’s website for a one-way trip from Lagos to Abuja had the prices of N50,400, N54,900 and N58,500 for Economy Discount, Economy Saver and Economy Flexible respectively. Business Saver and Business Flexible were N81,000 and N86,400. These fares go for a flight scheduled for February 23, 2022.

On Arik Air, a flight for the same date costs N50,000 and N86,024 for Economy and Premium respectively.

At the point of filing this report, both flights had almost been sold out.
Website checks on Air Peace showed that flights from Tuesday, February 22, 2022 to Friday, February 25, 2022 will attract tickets from N50,000, while checks by our correspondent on February 1, 2022 for Green Africa showed that one-way flights from Lagos-Abuja fluctuated between N47,000 on Tuesday, February 22, 2022 and N36,650 on Saturday, February 26, 2022 (Screenshots attached).

This situation is different from last year when economy flights on one-way tickets stretched between N25,000 and N29,000. Dana airline had begun the year with the introduction of flash sales tickets of N23,400, strictly for passengers travelling from Lagos to Owerri and Enugu.

“We have also introduced a flash fare of N23,400 for customers travelling from Lagos to Owerri and Enugu. We did N18,000 in December and now N23,400, so our customers are advised to plan their trips early, and visit our website www.flydanaair.com as fast as possible to get this fare,” Chief Operating Officer of Dana Air Obi Mbanuzuo was quoted to have said in a statement forwarded to The ICIR on January 18, 2022.
All that no longer exists as the N50,000 fare now similarly applies to the airline, according to checks conducted on its site on February 22, 2022.

Travel agents react
Folami noted that travel agents were unhappy with the current development
He said, “There is a hike in prices and the prices have been fixed and, definitely, it is a collaborative thing among the local airlines. We are not sure what has informed it but, obviously, it must be some operational cost. What component of operations cost is what we cannot tell. We are trying to find out what exactly the position is.
“Obviously, customers don’t like it; travel agents don’t like it. COVID-19 has done enough, and then the issues of high cost has arisen again. We will keep looking at ways of addressing it and we will make our views known to the relevant quarters.”
An aircraft engineer and Chief Executive of 7 Stars Global Hangar Isaac Balami sought an industry-wide intervention, mentioning measures beyond the N5 billion fund given to the industry during the heat of the pandemic in 2020. He blamed the hike in price on the unavailability of aviation Jet A1 fuel and lack of spare parts for aircraft.
Balami said, “I remember when I was at Aero Contractors operating about nine aircraft, every month our cost of Jet A1 was about N800 million. As a member of the national carrier committee, I was well informed by the group managing director of the Nigerian National Petroleum Corporation (NNPC) that Kaduna and Warri refineries can produce JetA1 at N50 per litre.
“If Aero was getting fuel from the refineries then, all it would have done is pay Asset Management Corporation of Nigeria (AMCON) N100 million per month to survive. Today, we are buying Jet A1 at N400+, how would they survive? Even at N50,000, airlines would have to work hard to break even with the cost of maintenance. Now they can’t access dollars at Central Bank’ of Nigeria’s rate, they cannot even afford spare parts, they are buying from the black market and struggling. I believe that the government needs to do the needful.”

The engineer was worried that the price could go beyond N50,000 if nothing was done.
He added, “I think there is a need for the government to have a strategic approach to solving this problem. If that is not done, it would go above N50,000. Right now, I know four airlines that can’t pay salaries. Their aircraft are even grounded. They can’t afford to buy spare parts due to the rise in dollars.”
How aviation fared in Nigeria’s GDP Q4 2021 report
According to Nigeria’s Gross Domestic Product (GDP) report for the fourth quarter of 2021, non-oil revenue accounted for 94.81 per cent to the economy, which included transportation, and by extension, air transport.
“The sector grew by 23.14 per cent in nominal terms in the fourth quarter of 2021, year-on-year. This rate was higher relative to the figure of -3.76 per cent recorded for the corresponding quarter of 2020 and lower than 41.61 per cent in the previous quarter. All the six sub-activities under Transport and Storage industry recorded positive growth rates in the fourth quarter of 2021,” the AFRAA report reads.
Similarly, transport activities contributed 2.01 per cent to nominal GDP in the fourth quarter of 2021, an increase from the 1.84 per cent recorded in the corresponding period of 2020, and higher than 1.57 per cent recorded in the third quarter of 2021.

However, Founder and Managing Director of Cowry Asset Management Limited Johnson Chukwu argued that the airlines were only seeking to exploit customers.
Chukwu mentioned his awareness of the support the airlines were receiving from the Central Bank of Nigeria. Chukwu stressed, in an interview with Television Continental on February 22, 2022, that airlines had market power “since it is a seller’s market that affords them the chance to increase airfares.”
He explained, “The Central Bank has been supporting them in terms of foreign exchange. An increase in airfares is exploitative. Because we don’t have an effective rail system and due to terrible roads filled with hoodlums, people are forced to go by air. This is why they can afford to increase airfares.”
Following the general outcry on the hike in airfare and the implication on Nigerian roads, the Senate, on Tuesday, February 22, 2022 called on the Federal Government to, as a matter of urgency, declare a state of emergency on the nation’s federal roads.
It also urged the Federal Government to immediately make good its indebtedness to the Federal Roads Maintenance Agency to enable the agency carry out its primary responsibility of rehabilitating federal roads, especially in the face of the astronomical increase in airfares.
Experienced Business reporter seeking the truth and upholding justice. Covered capital markets, aviation, maritime, road and rail, as well as economy. Email tips to jolaoluwa@icirnigeria.org. Follow on Twitter @theminentmuyiwa and on Instagram @Hollumuyiwah.