Onyema: Infrastructure impeding Nigeria’s airport hub status

Allen Onyema is the Chairman of Air Peace Airline, one of the carriers with prospect. In this interview with WOLE SHADARE, he speaks on the vibrancy of Nigeria’s aviation market, plans to grow the airline and sundry issues in the industry, including funding, which was and is still being provided by Fidelity Bank Plc. Excerpts

 

The Federal Government recently announced the suspension of Nigeria Air, can we say the prayers of domestic airlines have been answered?

 

The suspension of national carrier by the Federal Government is a huge challenge to domestic carriers or the country’s flag carriers to step up to the plate to offer Nigerians quality services. The decision to halt the process was a timely and courageous one. Nigerian airlines were at the verge of losing several billions of naira in investment had government gone ahead with the project. Government needs to channel its time and energy in supporting indigenous airlines and assist the airlines in international aero politics. Government’s aloofness has cost the airlines so much and led to their short lifespan. President Muhammed Buhari has challenged all of us with the suspension of Nigeria Air.

It is now left to all us to justify the suspension of national carrier by getting it right. One more thing, government should help us to fight aero politics. Nigerian airlines are suffering. The type of things they do us is terrible. Everybody is protecting their airlines but Nigeria is not doing the same. They give Ethiopian Airlines five destinations in the country to operate to. Who does that? It is very sad.

They say Nigerian airlines are weak and not performing, how can they perform under this type of hostile environment? We thank President Buhari for helping to remove waiver on aircraft spare parts and Value Added Tax (VAT). But the Federal Inland Revenue Service (FIRS) still come to collect VAT from us. We need government to help us do aero politics.

Air Peace Airline recently made history by making orders for 10 new B737 MAX, which shows that you are positioned to take airline business to the next level. What impact would this have on Nigeria’s aviation industry?

 

Air Peace Airline is now more positioned to lift Nigeria’s economy, create jobs and transform air travel. We are excited to add the 737 MAX to our fleet as we expand our network to offer more destinations and serve more passengers. The fuel efficiency and superior operating economics of the 737 MAX will ensure that the aircraft will play a major role in growing Nigeria’s business in the years to come. We commend Boeing, governments of Nigeria, the United States and Fidelity Bank, for their different roles in assisting the airline to achieve the feat.

The delivery of your first B777 came with lots of excitement, what is delaying its operation?

 

There is no problem about that. A lot of people are insinuating that Nigerian airlines are not doing well; they cannot compete at both the local and international scenes; they disappoint passengers and disgrace the country. Now, we have an airline that wants to get it right. It is true that our aircraft came in last February and up till now, it has not started. We do not want to do international operations with one aircraft.

We may have problems if we do something like that. We want to be solid, both at the local scene and at the international front. We want to make sure Nigerians are proud of their own. We want to make the international community not to have anything to hold on to fault us. So, we want to make sure that we put in place a solid structure for the upcoming international operations. These are the reasons why we have not started.

We do not want to go in there (international operations) and come out. We want to make sure we have enough planes to do the international operations. You do not begin international operations with one aircraft. If the aircraft develops fault, what do you do? You disappoint passengers? You don’t start international operations with even two, which is why we have acquired four B777. We have not started because the others have not come in. And we do not want to rush it. This country should be proud of Air Peace. There should be enough of the de-marketing of Nigerian airlines. Air Peace has done something even the outside world have been full of commendation for this airline.

I will tell you, all the major manufacturers of aircraft seek to do business with Air Peace. There is no major vendor in the world – may be for spares or for engines, which do not seek to do business with Air Peace. There is no main aircraft dealer that does not seek to do business with Air Peace, because they have done their KYC (Know Your Customer) and they have seen that this company is built on solid integrity.

So, it pains me when people in government say “all Nigerian airlines are heavily indebted, are weak, and cannot do anything.” It pains me and that should stop. We should stop de-marketing our own because of certain reasons. Air Peace is not stopping anybody from doing anything. We should stop generalising. You could say some of the airlines, but do not say all the airlines. I take exception to that.

So, we have not started international operations because we want to prove to the world that airline that is coming from Nigeria is ready to compete globally, for the right reasons. This is why we have not started. We are going to start this year, God willing. By then all our four B777 wide body aircraft must have come into the country. Then, we will start on a solid note. God forbid, if we have any issue with one aircraft, we will deploy another one. Air Peace is strong, to God be the glory.

The other day we went to Dakar, we had an issue with one aircraft, we do not take chance on anything and we dispatched another aircraft immediately, because we have the fleet size to do these things. May be another airline would have disappointed passengers, but that is not Air Peace. We have a solid business plan and we are following our business plan. We are true to our banks. We want to make Nigerians proud. We want to become the most sought after airline out of Nigeria.

NCAA recently released a report that your airline airlifted over 340,000 passengers between January and August. Are you optimally utilising your fleet?

 

First of all, I do not agree with all that was released. I saw some airlines that I believe did not do what they said they did. I cannot see some of those airlines doing more than Arik did. That is my own take. I do not want to comment on other issues there, but I cannot see any airline beside Air Peace having done more than Arik. So, if they said Air Peace is number one, the next one should have been Arik. There is no way you can optimally use your planes in Nigeria. The airport infrastructure does not support that. And that is why we are saying, the first thing we should do in this country is to improve on our airport infrastructures – from check-in to flight navigational aids, making airport environment conducive, both for operators and passengers. The infrastructure is poor.

There is no way airlines will optimally use their equipment. Air Peace has never, because many of the airports in Nigeria close shop at 6pm. So, when they close shop at 6pm, where will you go? Besides Lagos, Kano, Abuja and Port Harcourt, the rest close shop at 6pm. And these are parts of the causes of failure of airlines in Nigeria. It is a capital-intensive business. Every penny counts.

We must get our airport infrastructure right. It is not about saying Nigerian airlines are weak. I hate it, especially when it comes from government official – I do not find it funny. We should promote our own. Bring the legacy airlines of this world to come and do domestic operations in Nigeria, they will pack up in 72 hours. We (Air Peace) know what we go through.

Traffic figure in Nigeria is very low, less than 10 million for a population of about 200 million, how can we improve on passenger traffic?

 

Nigerians get more comfortable when they fly international airlines. They believe those ones maintain their aircraft better, because of the not too good incidents of the past. A lot of people are sceptical about flying any of the domestic carriers. Some will prefer to travel by road for 10 hours and even be at the mercy of kidnappers.

They do not care, because they do not trust Nigerian airlines. Again, Nigerian flying public believe that Nigerian airlines are ill-equipped and ill-maintained. Even those that agreed to fly, some of them would start praying four days before their flight. It is a matter of perception. Nigerian airlines are well maintained, because the Nigerian Civil Aviation Authority (NCAA) is on top of their game when it comes to the issue of maintenance. NCAA is even over-doing it. So, some of the things they could take for granted abroad, we do not here. I speak for myself as Air Peace. First of all, I wanted to give Nigerians a platform by creating employment; that is why I created this airline.

I am pro-Nigeria, I am pro-people. We have over 2,000 employees within a space of three years – direct jobs. I am not talking of the indirect ones Air Peace created. If government officials, over time, not only in this government, keep making statements that “Nigerian airlines are weak,” what do you expect the public to do? I challenge anybody to come and tell the world if Air Peace is weak. Air Peace is the fastest growing airline in Africa. The kind of money we spend in Air Peace when we go for maintenance, the legacy airlines of this world do not spend half of it. We spend close to $2.5 million to $3 million doing C-Checks and D-Checks in Air Peace. In the western part of this world, because they have everything around them, when they go for C-Checks, they can clear up to six months and come back later to do the remaining maintenance. When I go for C-Checks, I remove everything (maintenance) up to 24 months.

I make sure all the ADs (Airworthiness Directives) and the SBs (Service Bulletins) are observed. Even in America, they tell me “you are overspending.” I have phobia for flying. It was until when I established Air Peace that I started flying with my entire family; my wife and four children, we travel on Air Peace together.

What we are doing in Air Peace is unrivalled. I am not competing with Nigerian airlines, I want to compete with international airlines. That is why within two years, Air Peace received the IOSA (IATA Operational Safety Audit) certification, which is international standard attesting to our safety performance.

Not only that, the issue is not even receiving IOSA certification in the first place; retaining it is the biggest hurdle. Air Peace has retained it. You can find out from those who have not retained it, Air Peace is not within that bracket. We have retained it again and we have become member of IATA within a space of two years.

We deserve commendation from everybody, including government. Some of the news I read does not make me happy and I will speak up. We should start praising our own when we get it right, not trying to demean any airline. When we start letting the public know what we are doing and what other airlines are doing, I am not saying there may not be some who may want to cut corners – all I know is that NCAA, at least to Air Peace, is doing its job. We have been taken to the mills. If the same thing is being done to other airlines, nobody should fear in the Nigerian airspace.

I am talking of what NCAA is doing with Air Peace and I like it. When I wanted to start, I decided to outsource my maintenance to a British company, that is why they are here 24/7. It costs us a lot to do that. We are doing it because of safety. When people know that Nigerian airlines have improved, they will fly. And the number of those who are flying would increase. But the perception has to be done to put it right.

As a member of IATA where you have 290 airlines, have you shown enough commitment at partnering with members of this group to strengthen your operations, because you are in that pool already?

Even within Nigeria, I have been trying to promote a kind of cooperation with airlines. Each time I try, I hit a brick wall. I have told some of my colleagues that the sky is big enough to accommodate everybody. People should not be looking at Air Peace with envy, they should look at what I am bringing to the table for everybody. We should cooperate more. God will help every airline. We can even do spares pooling. It will help airlines. There is a lot of distrust. You have a lot of people you cannot trust in the system; that is the truth. You have a lot people who do not want to hear the truth. You have a lot of people who do not even want to advise government properly within our ranks as airline operators. And we should never blame government if they take any wrong decision at any time, because there are some of us within our ranks as AON (Airline Operators of Nigeria) who do not want to speak the truth that will help both government and the flying public. Coming to the issue of IATA, Air Peace, like I said, is part of the things that has not made us to hit the ground running with our international operations. We do not want to go out there alone. We are seeking partnership with other foreign airlines. We do not want to do point-to-point. We want to be a one-stop shop airline for passengers. For example, if you are going to Europe, we are able to drop you in London; you should be able to take another of our partners immediately. Assuming you are going to Amsterdam and you use Air Peace to London, there should be another airline that will take our passengers from there to Amsterdam. If you are going to Malaysia, we drop you in Dubai, another airline should be able to take you from Dubai to Malaysia and you collect your luggage in Malaysia. These are the things we want to do. We have got some partnership and we have started integration, but I am not going to name them. We have started integration with some foreign carriers – their IT and ours are doing the integration. At the right time, Nigerians are going to enjoy a world class carrier coming out of Nigeria in Air Peace.

None of Nigerian airlines is part of African Airline Association (AFRAA). Why is it so?

 

AFRAA is just an association. It is not a regulatory body. Your belonging to AFRAA does not necessarily give you any known edge. It is just an ordinary association. It is just like AON. I belong to AON does not give me any edge, except that it muscles its way on behalf of the airlines through advocacy and all that. You could be one of the unsafe airlines in the world and you still belong to AFRAA. It does not give you that edge. What gives you that edge is membership of IATA and being IOSA certified and that is most important thing. I am not a member of AFRAA, yet, all the major aircraft manufacturers are contacting us.

How do you think the Federal Government should handle the sector as a way forward?

 

The first thing is the improvement on airport infrastructure and aviation infrastructures generally. Improvement on them is very important. Don’t let anybody deceive you. This country will never be a hub to anybody or for anybody, except our airport infrastructures are improved upon.

Do you support the concessioning of airports?

 

I support the Federal Government’s intention to concession the airports. I support it 100 per cent. The way the airports are being run now, we are not going to get there. You continue blaming the Nigerian airlines, we’re not going to get there. Government has no business doing business. So, government running the airports will not even help government. The best airport in this country is MMA2, being run by concessionaire.

So, why are you not using MMA2?

 

Why am I not using it? When Air Peace wanted to start, that was where I wanted to go, but some forces stopped us. It was not my fault. I could not force myself. I discovered that the management of Bi-courtney did not even know somebody who was then acting stopped me. He was not acting in the best of their interest and it was not authorised. I was stopped from operating from MMA2 because I heard some people and airlines said “if you allow them come in, we will move out.” So, I decided to move to the other side where one airline was occupying to join, I was stopped again. I was floating for months.

They pointed to where I am today, which was moribund. No live, nothing there. As a new airline, I was scared of going there, because nobody knew us. I wanted to be where other airlines are, so the crumbs from their plates may fall into my own plate. Several forces were working against me, but nobody is God. By now, anybody fighting Air Peace should know that this is God’s own airline.

The intention behind setting up of Air Peace is noble. About 200 orphans are working in Air Peace courtesy of my wife. People should go back to my speech at the inauguration on October 24, 2014. When they pushed us to where we are today, I held a pillar and I wept and prayed because of how they were treating me.

Today, what is happening in that place? It took me almost two years to get AOC (Air Operator Certificate), even when I had seven aircraft on ground and everything going well for me. I believe in the oneness and unity of this country. I do not discriminate, but I have had a lot of discrimination against me. Why? So, I support concession. The Federal Government is doing the right trying to concession the airports. However, I do not support anything that will make anybody lose his or her job. Whoever is going to get the concession should be able to absorb the workforce.

You are growing your crew almost every day. How many pilots do you have?

 

We have over 100 pilots in Air Peace. We have trained so many pilots ab-initio, to type rating and line training. If you look at my employment policy, a lot people are wondering how we have succeeded where other people have been failing. If you borrow money from the bank, will you transparently show that bank your book in other for them to get their money back? Will you pay back what you owe? Are you treating banks’ money as nobody’s money and having no intention to pay back? We do not do that. Do you owe fuel marketers? Are fuel marketers ready to give you fuel even in ‘dry seasons’ when there is no fuel.

These are the things going well for Air Peace. When we buy fuel, within 48 hours, you must give us your invoice. As long as your invoice comes, we pay. When banks loan money to us we pay. We are prudent in our spending. I do not have anybody coming after me. Because of that, my banks are always ready to finance my operations.

Fidelity Bank, as I talk to you, is ready to go the whole haul with us. Some other banks are coming too, because they see that Fidelity is lending and enjoying it. They are lending to us and we are acquiring more aircraft. This is because the banks are supportive. This is because we have integrity. Last year, Fidelity gave us about N10 billion in one transaction. I said no that I needed N3 billion out of it. The other N7 billion, I did not touch. At every point in time, I borrow what I can pay back. I try not to owe people unnecessarily. We don’t owe our staff.

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