Barrister Allen Onyema is the managing director and chief executive officer of Air Peace, a new airline about to open shop in Nigeria. In this interview, he speaks on the innovations the airline would bring, decries the unwholesome competition in the airline sub-sector, comments on multiple charges which airlines pay to aviation agencies and the need for the government to address the issue, and makes case for interlining among domestic carriers besides some other issues. IME AKPAN reports.
Air Peace is one of the airlines that are yet to resume operations. According to the NCAA regulation, a start-up airline has to undergo processes before it is given the air operator certificate. How far has the airline gone with the certification?
It has been very rigorous; the process of getting an AOC is not a child’s play. You have to prove to the authorities that you can do it, that you are ready, and that you can play safe.
There are different stages and we are in the last one or the last but one. We have commenced demonstration flights and have done 15-hour zero passenger flights on the Boeing aircraft and about 23 hours on the Dornier. So, we are very close; our outstations and Lagos base are ready, we have put everything in place. We started recruitment since last year. People have been on our payroll for over 18 months now; we don’t owe salaries. We cut our coat according to the quantity of cloth we have. We planned properly; so the issue of lack of motivation for the workforce does not arise. It is about planning; it’s not as if we have so much money. It’s about good planning. When you need 10 staff and you take about 100 you are bound to have problems. We are very meticulous about planning.
I would like to commend the Nigerian Civil Aviation Authority (NCAA) for insisting that the right things are done. When you are not there you cannot actually know the extent which some Nigerians contribute to the growth and development of the country. The agency wants to Nigerianise everything about aviation in the country. The acting director general, Engineer Benedict Adeyileka encourages the employment of Nigerians; he wants airlines to give employment to Nigerians. And I’m in the aviation industry to provide jobs; unemployment is a problem in the country. I want to use the airline to give employment to Nigerians. I am not out to make billions. If you are a billionaire and you want to tumble down, go into aviation.
Airline business is capital-intensive. And if you say you are not in it to make money, how would you pay salaries and do so many other things?
The money I have invested, there are so many other businesses that I have. If I had to leave my money in the bank, I’ll make much because Nigerian banks would give me double-digit interest; they will give me about 13 per cent. If I left N1 billion in the account, I would get N130 billion at the end of the year. That money would be for me and my children.
I can never get that from aviation. A lot of people will find it difficult to believe but it is only those who know my pedigree that know that I’m saying it the way it is. I do a lot of philanthropy; I’ve been spending my hard-earned money helping others. So when I mentioned aviation one person said one aircraft can give direct jobs to 100 people and indirect jobs to 200 people. I decided to go into it believing that I can create massive employment for people. If it’s about money, I won’t go into aviation. However, I am not saying that I’m going to lose my investment. It’s not about making money. I established this airline for the generality of Nigerians, irrespective of tribe or ethnic group or religious affiliation.
Airlines come and go; the few that fly are struggling to stay afloat.
The problems have been attributed to faulty aviation policies and unfavourable business climate among others. Are you not worried by these issues?
If I say I am not disturbed, I will be kidding myself. That airlines are going extinct tells a lot. If you look at it, about 40 airlines have gone under; very few have survived. The government can come in; government has to do something about it. However, the present government has done a lot in the aviation sector. This is the first time a government has given zero-per cent tariff on imported aircraft spare parts. The money the operators would have spent on tariff would now be ploughed back into the business. This is a good thing and the government should be applauded.
But it has to do more. They have already done the airports which hitherto looked like poultry farms; now they have been given a facelift. Again there are multiple taxes paid by the airlines. Airline is a struggling business; the profit margin is very minimal. Now taxing the airlines heavily, making them pay charges to NCAA, Federal Airports Authority of Nigeria (FAAN) and the Nigerian Airspace Management Agency (NAMA) this and that, you are making money for the agencies while the airlines are just struggling under the weight of multiple taxes.
Government should look into it and reduce the charges.
There should be tax waivers; multiple taxes won’t grow the airlines.
Domestic airlines complain about allowing foreign carriers to operate to and pick up passengers from different locations whereas they are supposed to drop off passengers at the hub while they (domestic operators) airlift them to their destinations.
What are your thoughts on this?
It does not help the aviation industry; it does not help the employment of local personnel. Foreign airlines make their money and take it out of the country. Even with the bilateral air services agreement, it is difficult for you to operate into the home countries of some of the foreign airlines; they come up with all sort of clauses to discourage you. Government should protect the indigenous carriers; foreign airlines should be made to go into partnership with the local carriers to move people from one point to another. They should not be permitted to different airports. Because they get free funding from their home countries and banks, they can afford to do anything.
You have talked about foreign airlines going into code sharing or interlining with the local carriers. But there is no interlining among the local carriers. Why is it impossible?
In Air Peace, one of the things we want to do is to change the face of aviation in this country. You would agree with me that there is devilish competition in the airline sub-sector. Some airlines engage in de-marketing of others. It should not be; we should be partners in progress to develop the industry. It is only in Nigeria that airlines find it difficult to collaborate with the other. That is why passengers are delayed for several hours; you should not do that to your passengers.
If for operational reasons your aircraft is not ready or maybe you have some snag, if you do interlining or code sharing or whatever with another airline, your passengers can be airlifted. So, most airlines in Nigeria are not doing what they should do.
In Air Peace, we are going to encourage it (interlining); once we start operations we are going to look for the people we can collaborate with in case something happens and we cannot go on schedule. We want to ensure on-time departure; we want to give excellent service; we don’t want a situation in which we would delay our passengers unduly.
You airline intends to use the Dornier
aircraft for charter services and the Boeing for scheduled operations. Have you thought about the cost implications of using a bigger aircraft for flights of less than one hour?
The Dornier jets are not mainly for charter. We have three Dornier jets; one is a 13-seater executive jet for charter operations. Two Dornier aircraft are for shuttle services. The jets have short runway take off and landing capability. They can land where propeller jets do. We are going to use the Dornier to open up Nigeria; open up those airports people don’t fly to because they are underdeveloped. We will use the 32-seater planes to fly to such places and those smaller airports where the bigger planes cannot land.
Everybody is flying Lagos, Abuja Port Harcourt but Nigerians would want to fly to from Enugu to Kano. We are going to bring innovation into the aviation industry. We are going to do Enugu-Kano, Abuja-Kebbi, Abuja Makurdi, Benin-Port Harcourt, Warri-Port Harcourt, Port Harcourt-Calabar, Sokoto-Kano. We are going to open up the country and we want Nigerians to support us for we mean well for the country.
About the Boeing737 aircraft when I got to where I wanted to buy the aircraft, the dealer advised me not to go for the bigger aircraft because according to him Nigeria does not need such aircraft to do 50 or 60 minute flight. He said the highest point in Nigeria is Lagos-Maiduguri which takes 120 minutes. He said any airline that deploys bigger aircraft for short haul operations will be in debts forever. So, he gave me a Boeing 727-500 series.
