By Sanya Ademiluyi
One of the country’s leading airlines, Aero-Contractors has resumed flight operations after four months on the ground. Aero Contractors airlines on Tuesday, December 20,2016,in a statement signed by its Chief Executive, Fola Akinkuotu announced the resumption of its scheduled services across the country from December 22.
Akinkuotu said that the airline was re-launching schedule services to Lagos, Abuja, Warri and Port Harcourt, using its Boeing 737-400/500 and the Dash8-Q400.The airline’s operations had been grounded after a couple of workers strike over unpaid salaries. According to him, the suspension of flight operations last September was “a strategic business realignment to re-position the airline and return it to the part of profitability.”
The once flourishing airline had come to a sorry pass early last year when it became weighed down by debt running into several billions of naira. And then, went under receivership by the Asset Management Corporation of Nigeria, AMCON ,the state-owned manager of bad bank debts.
In September, tempers flared between the airline’s management and its staff, after the management ordered its 1,400 staff to proceed on an indefinite leave and said it was shutting down operations. Akinkoutu blamed “the current economic situation in the country, which has forced some other airlines to suspend operation or outrightly pull out of Nigeria,” for the “business “decision to shutdown the airline.
“In the case of Aero, the airline has faced grave challenges in the past six months, which impacted its business and by extension the scheduled services operations,’’ he said.
But the workers would not take that lying low. September 1,2016,two aviation unions—Air Traffic Services Senior Staff Association and the National Union of Air Transport Employees (NUATE stormed the headquarters of the airline at the Murtala Muhammed Airport ,Ikeja ,Lagos.The affected staff demonstrated at the shut gates of the airline demanding the immediate payment of the backlog of their salaries by the airline. Benjamin Okewu, president of Air Traffic Services Senior Staff Association, told journalists during the protest that the unions embarked on the measure following the indefinite leave given to the over 1,400 workers.
The Minister of state, Aviation, Hadi Sirika personally intervened on Tuesday, September 13,2016,when he visited the airline’s headquarters, assuring the airline’s aggrieved workers that he would assist to ensure an amicable resolution of the situation.
Following the airline’s massive debts to banks, which were assumed by Asset management Company of Nigeria, AMCON, the bad debt undertaker had taken over the assets and the management of the airline. But that has not solved the airline’s problems. On February 6,2016,AMCON had appointed a new receiver/manager, Adeniyi Adegbomire, for the airline. The new managers who took over from original owners, the Ibru Organisation, have had an uneasy relationship with the airline’s staff.
Since last September,Sirika has brokered negotiations between AMCON and staff of the airline .It is not clear if both parties had reached an amicable settlement of knotty issues between them by November end.
But anxious to cash in on the business boom of the Yuletide season, the airline management rallied the workers to resume flight operations in December. What could have thrown a spanner in the works was the shortage of aviation fuel which has hampered the operations all airlines for several months since last August.
For many frequent flyers, the return of Aero, as the airline is fondly called, is a welcome development. Some of the airline’s loyal customers even consider it a huge relief. Some of them say they would rather fly ‘Aero’ than other airlines on domestic routes because of its enviable safety records. In its over 20 years of commercial flights,the airline has kept a clean sheet of crash.
When Aero was shut, its customers turned to rival airlines such as Arik Air and Air Peace. As a matter-of-fact, Aero’s major rival was the biggest beneficiary of the absence of Aero, according to one aviation analyst .But with Aero temporarily out of the way, there was increased demand at Arik and the airline could rise ticket prices. Two years ago, both airlines had fought a bitter price war, severely discounting ticket fares on several routes, with industry analysts warning that the airlines could actually be losing money on these routes. And, in turn, risk financial problems. It is not clear however, if Aero Contractors’ subsequent financial woes were a direct result of its price wars with Arik.
In recent months, the Federal government has toyed with the idea of making Aero Contractors, the country’s national carrier. So far, that plan has not materialized. Nonetheless, Aviation minister Sirika says the Buhari administration still has plans to re-establish a national carrier in the shortest time possible.
How that will happen due to the government’s current lean purse and Aero’s place in these calculations, are yet unclear.
As Aero resumes flight operations, howbeit, in an even tougher economic environment, the question is if the airline can remain afloat.That is a tough one.
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