- Load factor shrinks by 50%, triggers fare hike
- Carriers attribute fares’ surge to forex
The sack of 300 workers by the management of Arik Air last week has sent a shock wave around the country’s aviation sector with fear that over a thousand more jobs from the airlines and other aviation support system could be on the line.
The airlines have discovered that furloughing work ers alone is not the solution at the moment to solve the crisis. The carriers were al ready grappling with high cost of operations, difficulty accessing foreign exchange and tough operating environment before COVID-19 set in early this year.
New Telegraph gathered that more airlines are perfecting the easier way of remaining in business by sacking more workers. Virtually all the airlines have taken a position to relieve workers of their jobs.
A top official of an airline, who preferred anonymity because of the sensitivity of the issue, said the situation was not helped by drastic reduction of aircraft fleet and cutting down of operations by over 50 per cent of their capacity.
Virtually all the airlines have cut down their fleet size because of COVID-19, which has led to reduction in air travel. Arik Air, last week, declared 300 of its workers redundant, attributing it to the devastating impact of the COVID-19.
The situation, the airline said, led to the constrained ability of the airline to complete heavy maintenance activities and return its planes to operations, stunted revenue against increasing operational costs.
The airline, in a statement, said: “It is important to note that over 50 per cent of Arik Air’s workforce of over 1,600 staff has been on furlough in the past six months on a base allowance. Decisions to let go of staff is naturally a difficult decision. Arik Air wishes the impacted staff well in their future endeavours.”
The happenings in aviation are not peculiar to Nigeria as many countries have already experienced massive job cut while many others have been furloughed following the devastating effects of COVID-19. But in Nigeria, the effects of COVID-19 have exposed the underbelly and fragility of a sector on life support without adequate bailout funds to rescue it.
Last month, Air Peace’s Chief Operating Officer, Mrs. Toyin Olajide, disclosed the impacts of COVID- 19 lockdown on the airline led to the reduction of its flight frequencies.
Olajide stated that the airline had several aircraft out on C-check maintenance abroad before COVID- 19 and were caught up with the global lockdown, forcing the suspension of aircraft maintenance. She noted that the aircraft ferried overseas for checks that time were supposed to have come back one after another, but for the lockdown in those countries.
Although, two of the numerous aircraft belonging to the airline ferried abroad returned recently, helping the airline to operate to some routes it suspended due to absence of airplanes. Observers opined that even if all the aircraft come back from maintenance, there’s no likelihood that over 20 airplanes by the owners could be deployed on all the routes it hitherto operated before the pandemic owing to drastic reduction in passenger traffic.
An aircraft engineer and a former official of Nigeria Airways, Shei Kyari, projected that over a thousand more jobs are going to be lost aside the huge number that had been lost already.
He told New Telegraph that the airlines did not have the capacity because of drastic cut of fleet with many aircraft ferried abroad for maintenance after air travel restrictions were lifted and were yet to arrive. He disclosed that the lack of capacity and temporary closure of some routes by the carriers led to hike in airfares by over 60 per cent.
His words: “The capacity has reduced. This has led to rise in fares. The capacity has reduced by over 45 per cent, meaning that the airlines are only doing 55 per cent of their operations for now.
The capacity is not there. It is a very grave situation for the airlines and country. There is no doubt about it. Job losses will accompany the situation airlines have found themselves. Over 1,000 more jobs are on the line.”
Kyari further disclosed that people focused more on pilots and engineers losing their jobs without looking at many more support staff that have been quietly been sacked, especially firms that are not unionised.
Chief Executive of Aglow Aviation Services Limited, Tayo Ojuri, stated that the airline industry had seen just 53 per cent load factor by the airlines because the airlines are not utilising all their aircraft.
He, however, stated that the airlines had capacity, but low demand because of lack of enthusiasm for people to take to air travel because of economic reasons. “The load factor is about 53 per cent for now. The airlines are not using all their airplanes. They have the capacity, but there is low demand for air travel currently,” he said.