Nigeria risks low passenger traffic for 2016
*Aviation contribution to GDP may drop to 2%
*More airlines offer zero commission to travel agencies
Nigeria is at the risk of declined air traffic following the withdrawal of airlines and the cut down of capacity on the lucrative Nigerian routes by foreign airlines.
The implication of this situation is that the revenue expected to go to agencies like the Federal Airports Authority of Nigeria (FAAN), the Nigerian Civil Aviation Authority (NCAA) and the Nigerian Airspace Management Agency (NAMA) and by extension other agencies.
Aside that, it is predicted that the development could have adverse effect on the contribution of aviation to the nation’s Gross Domestic Product (GDP) which before now was put at four per cent but which could reduce to just two per cent.
National President of National Association of Nigeria Travel Agencies (NANTA), Bankole Bernard at a press briefing admitted that high fares by both foreign and local carriers which have affected air travel would also have adverse effects on revenue that should accrue to government occasioned by sharp reduction in passenger traffic.
Bernard disclosed that the exit of Iberia and United has created a vacuum which he regretted that Nigerian carriers like Arik and Medview are not capitalising on by also raising their fares astronomically.
He noted that the policy of the government on exchange is really hurting and has forced a lot of travel agencies to close shop.
While Spanish carrier, Iberia and American airline, United have both departed Nigeria as a result of poor patronage and other reasons, British Airways has reduced capacity on the Nigerian route by deploying a relatively smaller airplane-B777 while taking off its super jumbo B747-400 it operated to Lagos for more than three decades.
The B747 is a 400 capacity aircraft while the B777 has capacity for 250 passengers depending on the configuration.
On July 1, 2016, Emirates, the United Arab Emirate (UAE) flagship carrier reduced its frequencies to Lagos from two daily flights to one.
The foreign carriers cited reasons of dwindling passengers, difficulty in repatriation of their trapped funds in Nigeria, among others as reasons for their decisions.
To the dismay of travelers and travel agents, the mega carrier Emirates closed reservation on one of its two daily Dubai – Lagos services, saying the afternoon flight EK781/782 would no longer be available for reservation.
Also reservations and ticketing officials at the airline’s office located inside the international wing of Murtala Mohammed International Airport (MMIA) confirmed the development to our correspondent.
Also a check on the airline’s booking page showed that only one daily flight is now available from Lagos to Dubai. To worsen the matter, passengers have to now pay more booking for Dubai flights on Emirate as some of the cheap rates hitherto displayed on the website have been cancelled.
A senior official at the airline’s office at the airport confirmed to New Telegraph that the decision had been communicated to them that beginning from July 1, the flight would be reduced to one per day.
When asked what was responsible for this, the official who pleaded not to be named because he was not authorized to comment on the issue simply said, “It is due to the nation’s economy. In fact, you can’t even get cheap flights again; you need a minimum of N400, 000 to purchase Emirates ticket”.
The NANTA President, said in order for the carriers to maximise profit, the few that offered to give travel agents commission have withdrawn them. He cited the case of Etihad which wrote to them that they are now coming up with zero commission to recoup what they might have lost to foreign exchange crisis.
Travel agencies may have been forced by airline operators to re-strategize on other routes to remain in business as the total zero percent commission policy on ticket sales been adopted by almost all airlines has taking a toll on their operations.
According to Bernard, “The zero commission policy was adopted as a result of the high cost of doing business and change in operational environment. As a result, airlines have commenced full ticket sales on their websites, forcing many travel agencies to repackage the ticketing business.”
Formerly in the ticket sales business, both international and domestic airlines were offering about 10 percent commission on a ticket sold to a customer but it gradually reduced to 1 percent and as a result of overhead cost, the commission was out-rightly scrapped.
