Nigeria’s aviation future: Collaboration over competition

The sector is witnessing a broader awakening across the industry. Airlines are realising that regional and international expansion requires a massive scale that cannot be achieved alone. Carriers are still sharply divided against what may be a game-changer for them, writes WOLE SHADARE

For decades, the tarmac of Nigerian aviation has been littered with the ghosts of airlines that flew high, burned fast, and vanished into thin air.

From the nostalgic eras of Okada Air, Nigeria Airways, and Kabo Air, to the more recent financial turbulences that swallowed others, the average lifespan of a domestic carrier in Nigeria has stubbornly hovered between 10 and 20 years.

But as the global aviation sector embraces lean, highly cooperative business models, the music in Nigeria is finally changing. Confronted by harsh economic headwinds, skyrocketing Jet A1 fuel costs, a volatile foreign exchange market, and heavy multi-agency taxation, stakeholders, regulatory bodies, and operators are arriving at a long-overdue consensus: Nigeria’s fragmented sky can no longer sustain a dozen solitary survivalists. To scale, local airlines must either partner, consolidate, or face systemic extinction.

Why flying solo fails

The traditional Nigerian airline business model has long been driven by fierce ego rather than strategic cooperation. Over the last two decades, more than 50 domestic operators have entered the market, only for the vast majority to collapse under the weight of mismanagement or insolvency.

When international aviation bodies like the International Air Transport Association (IATA) note how notoriously difficult it is to build a sustainable airline in Nigeria, they cite fragmented local operations. Without partnerships, domestic airlines suffer from severe operational inefficiencies.

If an airline’s sole aircraft suffers an AOG (Aircraft on Ground) technical breakdown in Abuja, passengers are left stranded for hours because competing airlines refuse to accept each other’s tickets.

Multiple airlines aggressively fight over the high-traffic “golden triangle” (Lagos-Abuja-Port Harcourt) while vital regional and secondary routes remain completely unserved.

Individual airlines drain their cash reserves by purchasing aircraft outright rather than pooling resources to secure collective, lower-risk wet or dry leasing arrangements.

Re de-risking revolution

The momentum toward a consolidated aviation ecosystem is being driven by the current regulatory landscape. Under the leadership of the Minister of Aviation and Aerospace Development, Festus Keyamo, the federal government has pivoted from chasing the ghost of a state-owned national carrier to aggressively de-risking the market for indigenous private airlines to become Nigeria’s global flag-bearers.

Through aggressive regulatory reforms, Nigeria has pushed its compliance rating with the Cape Town Convention (CTC) from a dismal 49.5% to an impressive 75.5%. By strictly enforcing the Irrevocable Deregistration and Export Request Authorisation (IDERA) framework—which guarantees international lessors the ability to safely repossess their assets if a local carrier defaults—Nigeria has systematically moved off the international watchlist.

The 2026 Nigeria Aircraft Acquisition and Investment Summit (NAAIS) in Lagos solidified this paradigm shift. Landmark agreements, such as the strategic partnership between Aircraft Finance Germany (AFG) and local financial powerhouses, have introduced structured leasing and financing frameworks. This allows local airlines to move away from high-cost outright purchases to flexible leasing, enabling rapid, low-risk fleet scaling.

Consolidation: Panacea for survival

The Aviation Round Table (ART) and key industry stakeholders have increasingly argued that merging four or more domestic airlines into two or three mega-alliances is the ultimate panacea for the industry’s high mortality rate.

Some experts are still sharply divided on mergers and consolidations, arguing that such arrangements cannot be decreed but are pursued by carriers with a similar operational mindset.

A former CEO of IRS Airlines and an aviation consultant, Mr Yemi Dada, stated that consolidation should be a strategic choice for operators and not something to be decreed or imposed by fiat, adding that if merging does not benefit an operator, why should they?

“Will merging make sense for airlines that operate the same routes and different aircraft types? Will merging resolve the credit default if both airlines are battling that issue across banks and service providers? I think the regulations we have now should be better enforced to achieve better results before pursuing policies that will not have any significant effect on airlines’ capacity.

To Raymond Omodiagbe, a merger is one solution for addressing ownership structures that do not enable good corporate governance.

The CEO of Ibom Air, Mr George Uriesi, in his argument, stated that no one can force two domestic airlines to merge, stressing, “If and when there will be a merger of domestic airlines, it will be as a result of evolution, rather than by force.”

He stated further, “I don’t know how people can just decree mergers. A merger involves mutually beneficial synergies across business models, business complexities, capital and cost structures, corporate governance, and, most importantly, organisational cultures. Then the two organisations can gain the consolidation benefits of a merger. On the other hand, we haven’t yet evolved to the territory of hostile takeovers, which are only possible under listed corporate governance structures. Anybody expecting the NCAA or the Federal Government to just decree mergers misses the point. Airlines will evolve to that level and then make that choice. It’s a choice of the airline, not an imposition on it by regulators.”

Vice-President, Aviation Safety Round Table (ASRT), Alex Nwuba, posited that the call for Nigerian aviation consolidation must look to the banking model not as a template for easy mergers, but as a lesson in brutal regulatory finality, where true survival requires institutional discipline over mere asset size.

He opined that while platform titans like Air Peace possess the scale and international routes to absorb domestic shocks, their highly centralised, founder-centric structures leave them structurally exposed to regulatory headwinds.

“Agile players like United Nigeria Airlines, Valuejet, etc. are expanding regional fleets and chasing West African corridors, but their long-term survival hinges entirely on transitioning from owner-managed entities into institutionalised, publicly listed corporations before the regulatory axe falls”, he added.

Interline,  codeshare agreements

The earliest stage of consolidation does not require a legal merger; it requires structural trust. By entering codeshare agreements, domestic carriers can sell seats on each other’s flights. A passenger could buy a ticket from Airline A in Uyo, connect seamlessly via Airline B in Lagos, and catch an international flight out of the country on a single baggage tag.

Setting up independent Maintenance, Repair, and Overhaul (MRO) facilities is capital-intensive. Through partnerships, local carriers can co-fund a unified, world-class MRO hub in Nigeria, eliminating the millions of dollars currently spent on C-checks and heavy engineering in Europe, the Middle East, and North Africa.

The ultimate evolution involves competitors willingly joining hands. An operator that commands a strong, highly efficient domestic network can merge with an aggressive, wide-body carrier focused on international routes. The resulting mega-carrier naturally enjoys stronger credit scores, massive leverage with international lessors, and the ability to buffer the shocks of shifting economic realities.

Last line

The future belongs to the collaborative. For decades, the missing link has been true industry collaboration. Nigerian carriers must learn to fly in formation. It is no longer just a viable business strategy; it is the only roadmap for survival. Without consolidation, they will continue to incur duplicate costs, see airfares spike, and find it incredibly difficult to offer efficient services even on the global stage.

Wole Shadare