Our new business model will help us until the return of our airplanes from maintenance, says Medview MD
Alhaji Muneer Bankole is the Managing Director of Medview Airpline Plc. He speaks to WOLE SHADARE on the recent hiccups with the airline’s operations, the reasons for sack of 52 workers in the rationalisation exercise carried out by the firms, skyrocketing price of aviation fuel, the plan return of services to London and Dubai among other way of reposition the airline for efficient service delivery. Excerpts
About our operations
In 2015, we opened the regional flight which we called the Anglophone and as you know, we are still there. Don’t let anybody deceive you. We have Accra, Freetown, Monrovia as our Anglophone. We were there together with most of you and we are running it. We felt again that we should hit London in May 2015. In January 2017, we had about 9, 000 passengers on the London route. What we are doing here is to give you records with facts. London has been a very profitable for Nigerians on this route are keen and happy for the success story of what we have been able to achieve. A lot of families in the past could not afford to come with children. With Medview’s support, they are able to come home and see their loved ones. We are still on our London route. Again, we thought of coming back to Francophone in 2017, precisely in October 2017. We are here to attest to the fact that the domestic route, Hajj operations, regional operations and international operations are sustainable routes for us. What we have done in the last few months was to return the leased B777. We had an issue on December 22, 2017 because of the return of that aircraft due to transponder. We came back to tell you what we planned to do and you are all here with us and we gave you the entire story. When we had issues with our ground handler, Menzies, we came back to tell you that the company was sanctioned and the leasing company was equally sanctioned by UK CAA. We commend them for that. What the UK CAA told the lessor is that if you are committed and sincere and you as operator, you owe them a duty to provide an aircraft when you have an AOG within a stipulated time of 48 hours. They did that. For the airport authority of UK, I want to say that we have very good relationship with them and we have respect for them. Gatwick authority is good to us.
Equipment
We made you to understand that we have four airplanes. Those airplanes from what you read in the newspapers and I want to debunk it right there that there are four. Medview own those four airplanes. The best way to survive in aviation is to own your assets. If you don’t own your assets you are on your own. When we started this business in 2012, we have a consolidated account we call no cheque book account. For you to have healthy financial status, we were locking money into that account that we did not have a cheque book to withdraw except when it is necessary, then, we use a transfer letter. That built financial capability that the banks especially First Bank saw the cash flow and came to romance us and said and asked if they could do something for us. From 2015, we already bought an aircraft 5N-BQM. That aircraft was our first baby, B737-500. We bought the aircraft with our cash flow. We are still very close with our Bankers, First Bank. Through their support, we bought with cash and finance leasing, we bought additional two airplane and one of them is called Abeke and currently, its being run in a facility in London which we have concluded the payment. We are doing reconfiguration on the aircraft and we are changing it from 221 to 242. What it means is that, we have three cabins now. Before, we had 30 Business Class, 191 Economy. Today, by the grace of God the aircraft returns. Apart from these two aircraft, we leased two aircraft; B777 and B837-800 which we have returned. The reason for returning the aircraft is because they have issues. If you have aircraft and you are not in control of it, you will be challenged. The decision to return them affected our London and Dubai operations. We are working closely with Boeing and a leasing company which you will see very soon. We have to procure a bigger aircraft that will support our Hajj and support our Dubai operations including London in no distant time. The B737-500 is that went for C-check will be delivered before the end of the month or first week next month. These affected our schedule operations. When you have two airplanes outside, you restructure your schedule, you will re-plan your strategy. What we have done now, they say Charity begins at home. Rather than fly everywhere, we consolidated on domestic operations and you can with no challenge, we are developing a new model.
From left, Managing Director/CEO, Med-View Airline Plc, Alhaji Muneer Bankole, Chief Operating Officer, Mr Michael Ajigbotoso and Chief Pilot, Capt. Stephen Fevrier at a press briefing on the Airline Aircraft undergoing Maintenance Repair and Overhaul ( MRO) and Reconfiguration outside the country. during a media Chat with MD/CEO at the weekend
Managing Director/CEO, Med-View Airline Plc, Alhaji Muneer Bankole, (middle) flanked by Chief Operating Officer, Mr Michael Ajigbotoso, (right) and Executive Director, Business Development, Alhaji Isiaq Na’Allah at a press briefing while the MD/CEO showing the pictures of Med-View Airline Aircraft undergoing Maintenance Repair Overhaul (MRO) and Reconfiguration outside the country. during a media Chat with MD/CEO of Med-View Airline in Lagos at the weekend.
London operations and Dubai comes back
The aircraft on check will be back first week of May. We plan to have then in May. What we did on the London, Dubai route was to go to the NCAA and the agency of government in those countries and they were happy about it. We wrote on March 15, 2017, we wrote officially that we would suspend the flights to those areas. The reasons why we planned to do so and we apologised to our dear passengers which we have done. It has been a commendable effort by my colleagues here. Some of our passengers flew on Emirates, Virgin Atlantic and couple of airlines. What we are saying here, we have ABEKE that will take up the Dubai shot, but there was a delay because of the complete overhaul of the aircraft and work went beyond what we expected at the MRO with refurbishment of the toilets, the galley. We bought a lot of new seats on premium economy. Once we get the delivery of the airplane, we are good to go.
Owing of workers’ three months’ salary
Today, Medview is carrying out staff rationalisation. That is normal in any business. Those who are affected can say whatever they want to say. All we did in January 2018 was look at the staff strength; we announced to some staff that we had to carry out the exercise. We normally do what we call one on one with the CEO. It is a yearly event. We are 395 employees. We have 18 stations. We have three international stations-Jeddah, Dubai and London. We have accommodation here and there. We run six regional operations. We have Nigeria operations about nine or ten and we put people everywhere. If you go to Owerri or Port-Harcourt, you still have Medview’;s presence there. As we are talking, we still have our regional operations there. January, we paid them. February, we paid 60 per cent of our colleagues including some of our pilots. But those we laid off were 52 and we are still doing it. We have to rationalise their payment because they are yet to meet the process of disengagement. When they give you letter, they need to go to Human Resources Department to return your letter, ID card; you do a lot of processing and they check your books if you are not on loan, they work it out and pay you your final entitlements. It is not our intention to lay off a family member in this harsh economy but we accommodated a lot. That is the true position of what happened. In February, we made some payments to them and we are doing this exercise simultaneously. If we gave you letter in February, we will give you notice of one month. It affected captains. You don’t need to limit it to low levels alone. It affected engineers, ground handling operators were also affected and those for one indictment or the other were also affected after facing disciplinary committee.
Allegation of indebtedness to service providers
Let me put a lie to it. If you owe Foreign Service provider, you will not last six months. The reason is that the antecedent of the past when we came in there, they said many Nigerian airlines had come and it did not take six months and never left good legacies. What they told us was for us to pay in advance. What it means is that you have the commitment to give three months and some of them rejected. Some cases, we put our credibility and integrity in place and say to them to provide the service and we will pay them and we successfully handled that. We owe nobody. It is a tough environment but we all know why. Fuel is no more available now. Price of fuel is going up. It is going to hit $90 very soon. Fuel now from Lagos is going to N220 per litre and it is going for 250/N260 in Yola, Maiduguri and we are not increasing the fares for passengers. We need to ask few questions. Is it fair for us not to add more money to our tickets? If anybody gives you a figure, go to FAAN. Please, contact the Director of Finance in FAAN and meet whoever you want to meet, we will tell you one language that there is one airline in this country that is not owing. On fuel, we have good deal with many of them. We have a credit line with them and you can ask them for figures to see for yourself. Our fuel consumption in five years was N22b. Go to Forte Oil. They have the highest volume of fuel we use. Some of them want to outsmart another. In business, you must owe money. They owe us money too. We provide service to people; government officials and they still owe us. There are people we fly for Hajj; I don’t want to mention government people. We have not collected our money. Did we go to town to say somebody owes us money?
Your new model of operation
We say charity begins at home. We have two airplanes on check. We have two airplanes coming in. In the interim, what do we do? The model is to bring the aircraft back home and fill the home demand very well. When you get your aircraft from checks, you network your regional operations and then go back to your international operation. What we are doing right away is hitting Abuja. It is a good deal for us. I thank my people from this side. That is the model. Keep the home front busy. We run from 7am and shut down at 9 pm. We do Abuja-Maiduguri, we do Abuja-Yola and people there are wonderful people. We thank our customers for believing in us. We must be open and blunt and say it the way it is. If anybody is in doubt, you ask questions. It is a tough environment and we all know what the situation is. Fuel is no more available now. We import fuel as you know. The fuel cost by a barrel is growing from $50 now; we are going to hit $90 very soon.
Still on our new business model for now
The business model as you wish to know, we are on regional, international; we are adding two more routes before the end of the year after Hajj. My colleagues here are working with South African authorities, Foreign Affairs have confirmed out letter and they are working with our office in Pretoria. That is just information for you. We were looking at South Africa and we will intensify on that when we get our baby back home. We are talking with the American government, working with a lawyer. That is in the pipeline.
High cost of fuel
We had our AON meeting today and one of the things we discussed was fuel situation in Nigeria. We cannot continue this way. This country is blessed. If you go to the market, you are the master of the market and the marketers sometimes say they don’t get the FOREX. They import this fuel. Three people are involved; the man who gets the licence to bring in the fuel by whichever means he brings it in. This is one owner. Another owner who has a dump, who receives the fuel to keep for the man, he has his own value. Don’t forget the other chains including the one on the sea and on the roads. When the fuel lands; they keep it somewhere before it finally goes to the people who need it. Because of security situation, they don’t go to Maiduguri. Fuel there goes for between N250 and N270.
Difficulty of Dubai by Nigerian airlines
I will give you an approach to this business line so that you can but into it. We are not going to deceive ourselves. Dubai is our home. What happened to our Dubai route was the failure of the aircraft that we got. Our first flight out of Dubai was 85 per cent load factor. We ran it concurrently for three months and you should be ready to hear what we intend to do. By sending the aircraft back, we now decided to bring in our own aircraft for total refurbishment to meet that standard of competition. I urge you to be patient to see the return of the airplane and to see the route resumption, by then it would be fair to judge us whether we are inexperienced or whether we lack capacity to provide these services. Emirates is 100 per cent owned by the government. Fuel is subsidised for them. Ethiopian Airline is owned by the government, it is 600 per cent subsidised. You don’t make comparison. There is no arithmetic to that. We are not competing with any of them. We are providing a separate model, second level comfort. How many of you here can buy $10, 000 tickets with N365 to a dollar? We are not discussing competition on Dubai route. We are going back to Dubai very soon. Our staffs are there, our offices are there, our equipment are there.
Difficult business environment and low fares
We held a meeting today. Two major issues were discussed. One was on VAT and the other one was on fuel. We are about six or seven schedule operators in Nigeria. The meeting was for CEOs of airlines. When we sell for N21, 000, others are selling for N18, 000 or less. The fare will not help us. You are the bottom. You must have a full capacity to break even. The other side of it is that somebody can sell for N15, 000 or N16, 000.
