Aero Contractors has crashed one-way ticket in the domestic market to N80,000 from about N150,000.

This is as Capt. Ado Sanusi, the Managing Director of Aero Contractors has declared that the current 35 per cent interest rates would kill aviation business.

Speaking with aviation correspondents at the airline’s headquarters at the Murtala Muhammed Airport (MMA), Lagos, recently, Sanusi said that the airfare crash, which had already commenced would last till February 2025.

According to him, the slash in airfares would enable families to reunite during the Christmas and New year celebrations.

At present, one-way ticket in the domestic market is about N150,000 to N200,000, depending on the route, airline and time of purchase.

The high airfares in the domestic scene had crashed the passenger traffic, while most of the hitherto customers have moved to other modes of transportation, especially road transport.

He said: “We are introducing pocket-friendly Christmas pricing because as a company with old history of understanding of its customers, we need to give back to them and the promo will start from N80,000 to all our destinations for them to meet their families and loved ones.”

At present, Aero Contractors operates nine routes in the domestic scene.

The routes are Abuja, Lagos, Kano, Benin, Port Harcourt, Asaba, Yola, Sokoto and Calabar.

However, Aero Contractors currently has three aircraft in its fleet. Two of the aircraft are Cally Air Boeing 737 aircraft.

“Currently, we have three aircraft in our fleet and two are currently running while one is coming up from repair. We are not increasing our routes, but only routes we ply.

“We intend to maintain our fleet of about three and we won’t bring any aircraft from outside, but we intend to let our customers connect their destinations.

Sanusi dismissed leasing of aircraft by the airline for its December operations.

But, Sanusi assured that the airline intended to increase the fleet to 10 aircraft in the coming years.

Also, Sanusi called on the Federal Government told to reverse the current high interest rates on businesses if it wanted the airline operators in Nigeria to gain and participate in the Cape Town Convention protocol recently signed by Nigeria.

According to Sanusi, with the current high interest rates of 33 to 35 per cent interest rates by airlines, no airline operators would survive the economy.

Sanusi insisted that the cost of running an airline in Nigeria was very high and the current poor economic situation was stifling growth in the system.

He declared that raising of interest rates to curb inflation would not work in Nigeria and called on the government to change its policies in a bid to grow the economy and increase the country’s Gross Domestic Products (GDPs).

He said: “The cost of funding in this country is very high. This is stifling growth in the aviation industry and all the gains of Cape Town Convention will be lost. I can’t see an airline going to borrow money at 33 to 35 per cent interest rates and then make profit.

“So, it must be addressed. I am not an economist, but I don’t think in this economy, you can increase the interest rates to tame inflation. Rather, you will be killing businesses. Ninety per cent of our vendors that provide us spare parts, fueling and others, they borrow money and they borrow at exorbitant rates. So, it is actually affecting the growth of the aviation industry.

“As a country, we don’t need to copy all what other countries are doing by increasing interest rates to reduce inflation, but we have to look at the peculiarity of our economy; the small-scale industry, the vendors that are supplying the airlines, the airlines themselves.

“What kinds of funding do we have? 33 to 35 per cent is not sustainable. There is no airline that can go and borrow money to refinance or to finance an airplane at 35 per cent interest rates and the dollar is N1,700 and then expect to make profit. That is a tall order for us.”

Sanusi also called on the Federal Government to address the multiple taxations, maintaining that the country should make a deliberate effort to ensure the airlines survived.

He explained that the airlines could not sustain the parastatals, calling on the government to seek alternative ways of funding the agencies.

Besides, Sanusi called for consolidation of the charges and levies by airline operators.

For instance, he expressed that the 5 per cent Ticket Sales Charge (TSC) pay to about four aviation agencies, but collected by the Nigeria Civil Aviation Authority (NCAA), the enroute and terminal charges collected by the Nigerian Airspace Management Agency (NAMA), fuel surcharge paid to the Federal Airports Authority of Nigeria (FAAN) and other charges should be consolidated into one.

“Government should scrap the 5 per cent TSC. Let NAMA reduce its charges to one for domestic operators. The domestic operators can pay terminal charge, while the en route charge is eliminated. All these charges should be consolidated.”

Sanusi also emphasised that Aero Contractors under the receivership of Asset Management Corporation of Nigeria (AMCON) since 2016, made 14 per cent profit in the current financial year, while its liability had also reduced by 33 per cent.

He further appealed to investors to invest in the airline in a bid to remain strong and engage more qualified Nigerians.