Hadi Sirika, the Minister of Aviation, made the announcement on Wednesday that the government would proceed with its collaboration with Ethiopian Airlines to run Nigeria Air despite resistance from domestic airlines.
Airlines Operators of Nigeria (AON) reaffirmed their opposition to the selection of Ethiopian Airlines as the primary investor in Nigeria Air during an interactive session with the Senate Committee on Aviation and the industry regulators.
Ethiopian Airlines is expected to hold the largest portion, which amounts to 49%; the Nigerian government is expected to hold a 5% share, and Nigerian investors are expected to hold 46% of the company.
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Allen Onyema, Vice President of AON and Chairman and CEO of Air Peace, stated that what Ethiopian Airlines had decided to do was to enter into the Nigerian market and reduce its prices to the detriment of the local operators over the course of a period of six months in order to take over sixty percent of the market share. Allen Onyema is also the Chairman and CEO of Air Peace.
He stated, “It is our conviction that the six-month timeframe will lead to the liquidations of several domestic carrier companies.” It is possible that the cooperation between Ethiopian Carriers and Nigeria Airlines Limited may initially give the impression of being beneficial; yet, in the long run, it will have reverberating consequences on the local airlines, whose market share will be significantly reduced.
“Within a short period of time, the local carriers will be out of the market, leaving only Ethiopian Airlines and a few others flying the Nigerian sector.
Because there would be a greater demand than there was supply, the cost of airfares would shoot through the roof as a result of this.
However, Sirika questioned why AON was against the national airline having Ethiopian Airlines as a strategic partner, claiming that everyone was brought along for the ride when the initiative was initiated seven years ago.
He stated that all airline operators, including domestic carriers, were invited, but the proposal calling for investments in the national carrier was won by Ethiopian Airlines. He added that the bid was duly won by Ethiopian Airlines.
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He stated that the purpose of the national carrier was not to put any business out of business, but rather to assist in the promotion of all enterprises, provide the required service, and employ Nigerians.
He stated that “the fact that it is going to be a robust airline that is going to be established, that is going to have connections all over the world, it only means that the market of Nigeria, which is 200 million people, will begin to be to the benefit of Nigerians and not to the benefit of British Airways.”
Lufthansa and Emirates are two of the world’s most prestigious airlines, and they are on their way to Nigeria to steal the country’s wealth. Therefore, one may say that the intention is pure.”