Air travel within Nigeria is reportedly one of the cheapest globally, according to Prof. Obiora Okonkwo, Chairman and Chief Executive Officer of United Airlines Limited. Okonkwo, who also serves as the Spokesperson for airline operators in Nigeria, made this statement on Channels Television’s The Morning Brief. He argued that despite higher operating costs, airlines in Nigeria still charge relatively low airfares.
Okonkwo cited the high cost of operations in Nigeria, including questionable taxes and levies, as a significant challenge for airlines. He noted that 99.9% of expenses, from spare parts to maintenance, are paid in dollars, while tickets are sold in naira. Additionally, loans for airlines in Nigeria have interest rates of 30-35%, compared to 2-7% in other countries.
The Federal Competition and Consumer Protection Commission (FCCPC) has launched an investigation into alleged price manipulation by some airlines, particularly on routes serving the South-East and South-South. The commission is examining pricing patterns and conduct that may undermine competition. FCCPC Executive Vice Chairman/CEO Tunji Bello emphasized that the agency is not a price control board but is mandated to protect consumers from exploitation.
According to Bello, the FCCPC will act decisively where evidence indicates that consumer welfare or market competitiveness is being undermined. The commission has the power to monitor economic activities, identify anti-competitive practices, and carry out investigations as necessary.
The investigation follows public complaints about excessive airfares, with some one-way tickets on domestic routes exceeding N300,000. The FCCPC is scrutinizing the pricing templates and ticketing behavior of airlines to determine whether the fare spikes violate the Federal Competition and Consumer Protection Act, 2018.
The House of Representatives has urged the Federal Government to grant immediate tax waivers to airlines to reduce flight fares during the Yuletide season. The Senate has also summoned the Minister of Aviation and other stakeholders to discuss the rising flight tickets. The FCCPC’s investigation and potential enforcement measures may lead to changes in the pricing practices of airlines in Nigeria, ultimately affecting the cost of air travel for consumers.