By Dickson Omobola
It was a celebratory mood at Aero Contractors headquarters at the Murtala Muhammed Airport, Lagos, on Monday, as the airline celebrated 67 years of operations. Past and current staff of Aero Contractors were present at the event, which was held at its hangar. After the event, the Managing Director/Chief Executive Officer of Aero Contractors, Capt Ado Sanusi, called on Federal Government to focus on genuine industry reform, among other issues.
Background:
We believe this administration has done well in infrastructure, but we are telling the administration that policy in the sector must address the specific challenges of the industry. I do understand the peculiar challenges affecting the industry, and if policies are not geared towards addressing those challenges, particularly as the Minister of Aviation and Aerospace Development, Festus Keyamo, has said that over 100 airlines have died, we should address that. Why are they dying? We should not accept the fact that 10 to 15 airlines die in Nigeria and say it’s normal. There is a particular problem that needs to be addressed, and those are the things I believe an industry-focused and genuine reform will address. What do I mean by industry-focused? It needs careful study and looking at the exact problems that we are facing and addressing them. Let me give you an example. Infrastructure is a very simple thing to take care of because if you have the money, you know what to build, then you will go ahead and build it. For instance, the Coastal Highway. Once you do the study and you have the money, you will build it. However, for an industry that has been here for the past 100 years, I think that was the first time that an airline landed in Kano, and an industry where we had the pride of the nation, Nigeria Airways, was shut down, liquidated and everything. An industry where the fastest-growing airline in Nigeria, in West and Central Africa, and in fact, in Africa, arguably, was allowed to go down. These are specific challenges that the industry faces, and I believe it shouldn’t be allowed to be a thing that the private sector should resolve. After all, when we had the banking crisis, federal government stepped in. We don’t need to have an aviation crisis before federal government should step in. While federal government is doing a lot on infrastructure and policy, there are specific challenges affecting the airlines, the parastatals and the support services that need to be addressed for genuine and sustainable growth.
There had been intervention in the aviation industry in the past, especially regarding monetary assistance. Some would describe that intervention as putting money into the system without getting adequate results…
I would like to address the first one, where you said there was an intervention in aviation. I don’t think there was any aviation intervention. I don’t think so. I think the intervention that brought the Asset Management Corporation of Nigeria, AMCON, to Aero, Arik and other airlines was made for the banks. The banks were failing because the airlines took loans, and the Federal Government created AMCON to rescue the banks. We were the collateral. It was not a genuine intervention to save the aviation industry. The only intervention I know of was by the former Minister of Finance, Ngozi Okonjo-Iweala, who gave a loan to the Federal Airports Authority of Nigeria, FAAN, to improve their infrastructure, and the Nigerian Airspace Management Agency, NAMA, I think. When I was MD of NAMA, there was this infrastructure development of all the towers, and that was what they called the Central Project, which was given as an intervention loan, which was paid, I believe, by FAAN. But there was no intervention. If you say money has been paid or has been given to the airlines, it is a no. Aviation did not receive any money as intervention money. The banks did, and they rescued them.
At 67, what should we be expecting from the oldest airline in Nigeria? Are you bringing in more aircraft? In your speech also, you called for Aero to be protected and recognised by Federal Government. Those words are pregnant with meaning…
We have more routes coming up. We intend to renew our fleet. We also intend to increase our capability list for the MRO, meaning we are buying equipment, we are buying tooling and, very soon, we will be an Embraer centre, where we will repair Embraers. We are also looking at enhancing our training capability. We are opening a new training facility very soon, and we intend to grow it. All that is in the future for us is to be adaptive to the yearnings of our customers, and also to be innovative, and also to ensure that we give our customers, either in the MRO, in the school, or in the airline, a seamless, efficient and reliable service. Most importantly for us is to remain safe, and that is what we are doing. For the pregnancy that you are talking about, and you want me to see whether we can predict the child, it is good to make a prediction, but it is extremely important not to pre-empt, because if we pre-empt, the naysayers will kill it. So, I will leave it as a national treasure, and it should be recognised like that, and also protected. I don’t know when to predict, and somebody will shut it down.
On MRO, you have done well in the last nine years. I can see that you have brought in some equipment for the MRO. Can you just put the equipment in Naira?
I would say we have invested millions in the equipment and tooling. I don’t think we have to mention how much we have spent to do that. Most importantly, we understand the need to have modern tools, and these tools are modern. Yes, there is a lot of money spent to buy them, but as I said, we are adaptive to the new challenges that we are facing in the MRO.
In specific terms, how has the Cape Town Convention, CTC, Practice Directions helped your airline?
Honestly, I don’t think it has done anything. That is the truth. I can’t say CTC has helped increase my fleet. CTC is giving comfort to the lessors that when they want to take their planes, they are able to take them. It has been in effect for a long time, just that we bastardised it in Nigeria. You can change the law, but you can’t change the people if the people are still not willing to release the assets of those that we have leased from, and we have not gained the confidence.
I prefer to gain the confidence of the lessors than have a very strong CTC. After all, some countries are enjoying a lot of leases without enforcing so much of the Cape Town Convention. Small countries and territories. That is because they have gained the confidence of the lessors. In Aero Contractors, we have gained the confidence of some lessors.
That is because we are paying our lease rentals, and when there are things to be talked about, we do so. That is how we can do it as an industry, not relying on CTC, which is just giving a platform. You must work to ensure that, as individual airlines, you gain the confidence of your lessors, and then Nigeria will be enjoying the entire CTC.
Some airlines have decided to cut down on unprofitable routes. Are you going to follow the trend? What is the debt situation, and can you give us a timeline for when Aero will disengage from AMCON’s receivership?
Globally, airlines are reducing flights or cutting off routes that are not profitable. Aero Contractors is probably going to do the reverse because what we look at is that whenever there is this type of crisis, we see opportunities. This management will look and see opportunities building up. As airlines are withdrawing from a particular sector, we are also looking and choosing the right equipment and the right time and price to make sure that we stay in business. Globally, that’s the trend because of the high cost of Jet A1, but we in Aero Contractors are having a holistic approach to it.
We are looking at the crisis as an opportunity for us to grow. As the saying goes, you cannot shrink yourself to greatness. You can’t be cutting routes and you think you will grow. We are very grateful for our relationship with AMCON. They came to Aero Contractors when we needed them the most, and they gave us a second chance.
For the timeline, I think that question should go to the receivership and AMCON. I am saddled with the responsibility that the airline keeps running and employing more Nigerians.
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