Nigeria: Airlines Lost Billions in Revenue for Shunning Kaduna

By Chris Agabi

Foreign airlines operating in Abuja on the average lost about N5 billion (about $16 million) in ticket sales and cargo charges for refusing to fly to Kaduna, sources in the aviation industry told Daily Trust.

Information from the industry said the airlines couldn’t airlift up to 50 percent of their Abuja passengers on their Lagos and or Port Harcourt routes.

At least 263 international flights from the Abuja airport were cancelled by seven airlines during the closure.

Ethiopian airline was the only international airline that operated the Kaduna route. Within the period of closure, the airline processed over 5,000 passengers from the Kaduna airport and raked in about N2 billion in revenue.

The seven airlines that hitherto operated from the Abuja airport and refused to fly to Kaduna airport included British Airways, Air France KLM, Lufthansa, South Africa Airways, Asky, Egypt Air and Turkish Air. Combined, they operated 263 flights in six weeks.

These airlines also didn’t announce increased number of flights on their Lagos or other routes.

Data analysed by our correspondent showed the foreign airlines lost huge revenue.

The average passenger traffic and ticket costs $900 for economy and $3,000 for business class passengers. Analysis showed the losses in ticket sales for foreign airlines could be as high as N5 billion while cargo charges could be as high as N500 million across all the seven foreign airlines that refused to fly to Kaduna.

The Federal Government also lost over a billion naira in revenue during the six weeks of closure. This is because, besides the annual fees charged the airlines, the Federal Government derives some revenue from certain charges daily on airlines, and this runs into millions of naira per month, per airline.

The charges to the airlines vary, depending on the capacity of aircraft, the distance of the route, the number of hours an aircraft is parked and the number of passengers booked among other indices.

Aircraft traffic analysis on the foreign airlines showed a total of 45 flights per week by the foreign airlines. Thus in six weeks, the Abuja airport should have operated 270 international flights.

The average number of passengers on the airlines suggest that about 6,490 fly per week from Abuja airport on the seven airlines excluding Ethiopian Air. Thus in six weeks, some 38,940 passengers were processed.

Based on this estimated passenger traffic, the Federal Government lost some N593,835,000 ($1,947,000xN305) in passenger service charge. $50 is charged per passenger on each ticket sold on international flight by the government, which is collected by the Nigerian Civil Aviation Authority (NCAA).

There are other charges which the airlines pay which include; Enroute Charge (navigational charges) which is about $500 or more on each foreign aircraft depending on the route and on every landing.

Also, Cargo Sales Charge is collected on all cargo the aircraft carried. Other charges include; landing charges and parking charges which is also charged depending on the aircraft type and number of hours on ground. At least between $2,000 to $3,000 is charged depending on the aircraft type. Fuel surcharge is also charged to the oil marketers and collected by FAAN.

Commenting: Group Capt. John Ojikutu, a member of the Aviation Round Table said if the foreign airlines had increased their number of flights in Lagos, the FG won’t necessarily suffer losses as the airlines would pay the charges in Lagos.

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