Over-taxation and the difficulty in accessing foreign exchange have been identified as the two major reasons indigenous airlines have been operating at a loss in Nigeria.

This is as Aero Contractors said it has restructured its strategic businesses to mitigate loss and improve its operations.

Capt. Ado Sanusi, the Managing Director, Aero Contractors, stated this on Thursday at the Murtala Muhammed Airport (MMA), Lagos, during the re-launch ceremony of the airline.

According to Sanusi, the nation’s airlines were going through turbulent period with over-taxation and foreign exchange, which has continued to rise in the past few months.

He regretted that the difficult operating challenges had made the nation’s airlines not to declare profit in the past 30 years and called for a change of approach from the government.

Sanusi insisted that the government could not continue to tax the airlines to grow the agencies, stressing that players in the industry needed to come together as a team to address the challenges in the airline sub-sector in the past three decades, saying that Aero Contractors could not be isolated from the industry challenges.

He said: “The challenge for all airlines is finance and Aero Contractors voluntarily suspended operations partly because of finance. So, every airline in this country is experiencing challenges with finance, foreign exchange and multiple taxation.

“Every airline has a challenge of finances for the past 30 years. I don’t think any airline has posted profit within the period. What does that tell you? It means there is something wrong, may be the environment we operate in. Other airlines even in Africa are posting profit.

“Back to Aero Contractors, yes, we had a challenge of finance. Now, our cost structure, we have tried to reduce it. We also tried to look at outsourcing to reduce the cost. The four strategic business units we have will support the airline so that through that we can reduce outside spending.”

Sanusi also said that the Asset Management Corporation of Nigeria (AMCON) had approved for Aero to source financial support in local and foreign banks.

Also speaking at the event, Dr. Harold Demuren, the Chairman, Technical Advisory Committee, Aero Contractors said that the airlines voluntarily agreed to withdraw services to restrategise and reposition the carrier.

He assured that the airline would continue to operate safety and commended the staff of Aero for their resilience, commitment and faith in the airline.

Demuren noted that the aviation industry, especially in Nigeria, was going through turbulent times.

“When you commenced a business with N170 to a dollar, but now, it has increased to almost N800 to a dollar. The price of ticket has not really matched up with the inflation in the sector.

“Aero Contractors as an airline has not had a major accident since it commenced operation. I want you to keep it up. I wish the managing director well, but he cannot do it alone. He needs the cooperation of others. It is a great challenge, but it can be done,” he said. (Daily Independent)

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