Chinedu Eze

For the past three weeks, Nigeria’s foremost airline, Arik Air, which blazed the trail of modern airline business after the demise of Nigeria Airways Limited, has been operating only one aircraft, which is against the regulation of the Nigeria Civil Aviation Authority (NCAA), THISDAY investigation has revealed.

According to NCAA regulations, any airline whose fleet reduces to one aircraft should be grounded but Arik Air has been operating one aircraft for over three weeks. It was learnt that the airline does not have any other aircraft on lease.

Miffed by this development, experts in the aviation industry have looked at why Nigerian carriers have such short life span as Arik Air, which was established with such high promise and expectation seems to have become moribund.

Experts traced the history of the airline and concluded that the airline was built with the strongest foundation, pioneering the acquisition of brand new, state-of-the-art aircraft about eight years after the defunct Nigeria Airways brought in its last new aircraft long after it went down.

Arik Air started flight operation on October 30, 2006, with its inaugural flight from Lagos to Abuja. At the time of its inauguration, the airline began with three brand new Bombardier CRJ900 aircraft, which was historical; at the time privately owned Nigerian airlines were operating very old equipment.

That period marked a turnaround in Nigeria’s aviation history because the Nigeria Civil Aviation Authority (NCAA) had become autonomous with the passing of the Civil Aviation Act 2006. It was also the first time Nigeria passed its International Civil Aviation Organisation (ICAO) audit, which was a significant achievement as it demonstrated consistency in meeting ICAO’s safety standards. 

It was that period that ushered in the modern era of Nigeria’s commercial aviation with very good record of air safety and Arik Air was at the forefront of it all. But on February 9, 2017, the airline was taken over by the Asset Management Corporation of Nigeria (AMCON). That was when the downside began.

Despite the controversy surrounding its take-over, AMCON confirmed that it inherited 17 airworthy aircraft, out of 30 aircraft in the airline’s fleet, but today only one aircraft is still in the fleet of the airline.

Even before the establishment of Arik Air, most Nigerian carriers go down after 10 years of their establishment.  

Trustee Member of Airline Operators of Nigeria (AON), Captain Roland Iyayi, described airline business as a super market, which makes a huge turnover but little profit.”

According to him, if an airline makes huge revenue, and the owner does not manage the funds well, when payment for aircraft maintenance comes, the airline will not be able to pay. “So, one of the factors that led to the failure of Nigerian airlines is the inability of the managers of the airlines to prioritise the critical areas in which the money should go in order to sustain the airlines’ operations,” Iyayi said.

“Recall Arik Air has been under receivership, it needs funds to continue to operate but government is not funding the airline. The revenue the airline earns is not enough to pay for major maintenance; hence there are many aircraft that are grounded at the airline’s head office.

“I learnt that Captain Roy Ilegbodu (the CEO of the airline) approached AMCON to request for money to maintain the airline’s aircraft. AMCON agreed and later changed its mind because the founder of the airline, Sir Johnson Arumemi-Ikhide, went to court and the agency removed the credit line it wanted to give to Arik. You can have all the aircraft in the fleet but if you cannot cover the cost of maintenance, it will be a problem,” Iyayi further said.

Commenting on the parlous state of Arik Air in line with why they were taken over, the Executive Secretary of Aviation Round Table (ART), Olu Fidel Ohunayo, said government intervened in organisations to save jobs, principally, and also to save the economy by allowing critical companies with large staff who have impact on a sector of industry to remain in operation.

“I think AMCON got it wrong at some points. AMCON intervention was apt as at that time Arik was going through a lot of problem, even buying the aviation fuel or paying aircraft insurance at that time was difficult. They were having issues generally, and their aircraft were being grounded one after the other. But post-intervention, I think AMCON stayed too long. Along the line, they lost focus. Some of their staff drifted from the novelty of reviving the organisation. In doing that, they started to run deals with some dodgy professionals. They were listening to people who said they were experts. 

“In doing that, instead of them restoring some credibility to the company, some revenues that could be used to wipe out alleged debts and keep the company focused, was not used for that purpose. Rather, they were involved in offloading the assets of the company. I think what would have been good for Arik then, after taking over, was to look for competent airline management organisations to take over the running of the airline while they stay outside to just monitor the revenue stream and how they can correct all the liabilities that were on the ground. But getting themselves involved in the direct management was the biggest error. You cannot be a professional in all industries. You are supposed to recover funds owed to the banks,” Ohunayo said.

However, insider source at Arik Air told THISDAY that although the airline has only one aircraft operating and has not been flagged down by NCAA because the agency knows what problem the airline has.

The source defiantly told THISDAY that Arik Air was not going to go down; that the management was working on something whose result would soon emerge and the airline would become strong again to fly to many domestic destinations.

The source said that when AMCON took over the company, workers started leaving, especially the technical staff such as pilots and engineers, but AMCON increased their salary and has been doing so over the years.

“Arik Air cannot die. It is still very strong. Arik Air workers are some of the best paid airlines staff in Nigeria. The workers are happy because they know their take home every end of the month. This is a phase which we hope to overcome soon,” the source said.

THISDAY also sent message to the Director of Public Affairs and Consumer Protection and NCAA, Michael Achimugu, to know why NCAA allowed Arik Air to be operating with only one aircraft in its fleet. He promised to confirm from the “relevant directorate” but he did not get back before this report went to the press.