Nigeria, Costliest Country for Airline Business

Chinedu Eze
Thisday Lagos

Foreign airlines that ply the Nigerian route have reacted to allegation of charging high ticket prices, and exploitation leveled against them, saying Nigeria is the costliest country for business.
Presenting their position yesterday during the second day of the public hearing sitting of the Committee on Ticket Pricing on International Routes and Other Matters set up by the Minister for State for Air Transportation, Chief Femi Fani-Kayode, the foreign carriers which presented a paper under the aegis of the Board of Airlines Representatives (BAR), said economic factors and the law of supply and demand dictate ticket fares.
Spokesman of the airlines and Chariman of BAR, Mr Yemi Osindero, said the cost of doing business in Nigeria is higher than elsewhere in the world.
Osindero who is also the Chief Operating Officer of Virgin Nigeria, said since deregulation, economic factors like demand and supply, as well as bilateral agreements determine prices on routes, noting that airlines are prohibited from fixing fares arbitrarily or colluding to do so.
The operators, who were absent at the first day of the public hearing, listed over flight charges, handling charges, high fuel costs as well as scarcity of its supply, and also agency Fees, as some of the costs which jerked up fares on the international routes.
He said Air Traffic Control charges in Nigeria were also very high, adding that turn around costs at the Lagos Airport was well and above what is observed in other locations.
Osindero said, "in Lagos, we have turn-over costs of $11,000 while in Dubai, it costs as low as $1,900,” adding that the culture of Nigerians not booking early for their flights also robbed them the opportunity of enjoying lower fares.

“Nigerians don't have a culture of booking early for their flights and at the same time, there is a high level of absence, that is, not showing up after booking and these also affect the fares they get,'' Osindero said.
He also said that the number of frequencies and the size of market were other reasons which accounted for price differentials on routes which had similar distances, explaining that while Lagos-London had 25 weekly frequencies, London-New-York had 241 frequencies, while Dubai-London had 82 frequencies weekly.
The BAR chairman said the size of the market impacted on the pricing, adding that competition, including products branding by airlines, customer perception and aircraft type among others also lead to price differentials.

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