Sharp rise in airfares across domestic routes may threaten passengers’ travel itinerary for the remaining months culminating in end of year travel, described in aviation parlance as future flights.
The steep rise in the cost of air tickets, in particular for travel within the country, is already creating unease for players in the mobility ecosystem, as airlines and other players in the sector are divided on the reasons for the development.
Investigations by The Nation reveal that despite the entrance of a few carriers: Enugu Air/ Xejet Airlines operational model which has increased the fleet of aircraft, fares are still very prohibitive.
Investigations reveal that the fare hike is more noticeable in the “Triangular Routes” – Lagos/Abuja/Port Harcourt as opposed to routes flown by fewer operators.
While Air Peace is the largest indigenous carrier by fleet size flying into major routes including Lagos, Abuja, Owerri, Enugu, Uyo, Calabar, Kano,Benin, Warri, Asaba, Port Harcourt, Anambra and other routes, Ibom Air operated into seven routes. Aero Contractors Airlines, United Nigeria Airlines, Arik Air, Green Africa Airways, Overland Airways, Rano Air, Max Air, NG Eagle Airlines, Xejet Airlines/ Enugu Air , ValueJet Airlines and others connect to over 30 airports across the country.
Experts say routes with higher passenger traffic such as Lagos / Abuja to South East/ South South ought to attract more competitive fares as opposed to routes, where some airlines have comparative advantage.
Checks by The Nation reveal that ahead of year end travels, a one-way ticket on some of the airlines has increased to about N350,000 or more for travel to Southeast and South-south.
Fares on OwerrI, Enugu, Anambra, Asaba and other Southeast routes have increased by over 100 per cent ahead of the end of year travel.
While many passengers are accusing airlines of deliberately triggering a hike in fares, the operators are pushing back.
An airline official who pleaded to be named attributed the development to certain economic considerations.
The operators said passenger traffic somewhat tilts towards outboundly during end of year travel, leaving airlines with empty seats in the beginning months of the year.
He explained that for Southeast-bound flights, traffic within the yuletide is on- way. In December, passengers fly Lagos/Abuja to Enugu, Anambra, Owerri and Asaba, while it reverses in January.
He noted that the imbalance compelled airlines to ferry near-empty aircraft back, either to Lagos/Abuja in December or to the Southeast in January.
The operator said the “positioning flights” impose steep costs on operators as an aircraft burns the same amount of fuel, pays the same crew, and attracts the same maintenance obligations in each flight, irrespective of the capacity occupied.
He added, “It is also worth noting that fare increases during the yuletide are not limited to airlines. Road travellers heading to the Southeast face the same challenge. A Lagos to Onitsha bus ticket that typically costs between N24,000 and N35,000 in regular periods may rise to above N50,000 to N60,000 during Christmas.
“Yet, the public outcry is almost always directed at airlines, while road transport operators often escape the same level of criticism. We will continue to operate flights in the best interest and safety of our customers.”
Investigations further reveal more passengers are now adopting the strategy of booking far ahead of their travel date to stay ahead of the pricing curve.
An industry expert said: “Smart travellers and travel agents, familiar with this cycle, often stay up at night waiting for airlines to release yuletide schedules, rushing to grab the cheaper seats before demand pushes the system into higher fare brackets.”
Meanwhile, industry experts attribute the high airfares on the domestic routes to the harsh operating environment.
They say airlines face volatile foreign exchange (FX) rates, high fuel costs, multiple taxation and inadequate infrastructure.
According to them, the prices of Jet A1 (aviation fuel) have more than doubled in recent years, while operators often pay in dollars for maintenance, insurance and aircraft leasing. Yet, the operators earn revenues in naira.
Experts say the environment leaves little margin for airlines to absorb seasonal shocks.
Speaking on the development, industry analyst and Chief Executive Officer of Centurion Securities, Group Captain John Ojikutu (rtd), said airlines need to stay ahead of the curve in their projections for passenger traffic.
He said operators should not always or only depend on the Christmas period to break even in their earnings.
Ojikutu reasoned : “ Not many of them do sufficient business plans before venturing into commercial aviation . The passenger traffic has not gone beyond 18m it was in 2019 even when the projection of 20m was for 2020. We are in 2025 and the 20m is still a mirage with the daily increase in the number of airlines.
“ I have advised that the airlines should supplement the decrease in passenger numbers with domestic and regional cargo flights, Others feel, without trying or applying, that the NCAA will not approve the configuring of their aircraft. Check our population with the air travelling passengers and compare with our contemporaries in Africa.
“Most of these airlines may not even know that not less than 70 percent of their passengers are government and corporate officials that are not the ones paying ticket fares from their personal pockets.
“Not even the larger population are earning N70,000 or less. How are they expecting them to pay N200,000 for a one way ticket in Nigeria’s present economy?”
Ojikutu urged local carriers to reverse their business plan, if they are determined to achieve sustainability.
Speaking on the development, aviation industry consultant, Captain Bruno Adebanwin said: “ Domestic fares are high due to operational costs, which include rising fuel prices and dollar-denominated expenses like maintenance and aircraft parts, and market dynamics.
“Where increased demand, a reduction in available aircraft due to high maintenance costs, and less competition can drive up prices. These factors, combined with economic challenges like currency devaluation, make flying more expensive for airlines, who then pass these costs on to passengers.”
He further said: “Rising aviation fuel prices directly increase airlines’ operating expenses, which are then reflected in ticket prices. In countries like Nigeria, earnings are in local currency (naira), but key costs like aircraft maintenance and parts are priced in dollars, so currency devaluation makes these expenses significantly higher. A lack of local maintenance facilities forces airlines to send aircraft overseas for maintenance. This leads to fewer available aircraft, reduced capacity, and therefore higher prices for the remaining seats:
“Fares increase when demand for travel outstrips the available capacity, especially during peak periods like holidays.
“When there are fewer airlines operating, particularly on certain routes, competition decreases, allowing the remaining airlines to raise prices.
High demand and low supply naturally drive prices up. If available seats are not meeting the number of passengers wanting to travel, airlines will increase fares.
“General inflationary trends also contribute to the overall increase in operating costs, which are passed on to consumers through higher ticket prices.
“A fluctuating and unfavorable exchange rate for the local currency makes importing necessary components for airlines much more expensive.”
