Africa: 24 months after Aero facility upgrade, airlines spend N7bn on aircraft maintenance abroad
Twenty-four months after Aero Contractors upgraded its facility to carry out maintenance on Boeing 737 aircraft in Nigeria, domestic airlines still spend about N7 billion annually to maintain their aircraft outside the country.
There are not less than 23 Boeing 737 aircraft operating in Nigeria, but Aero Contractors has been able to carry out C-checks on only three aircraft in its facility. The remaining 20 aircraft are still being maintained outside the country.
Out of the 23 Boeing 737 operating in Nigeria, Air Peace operates 12, Azman operates three, Medview operates three, Allied Air has two, JetAir operates one, and two other charter services operate two Boeing 737s, BusinessDay checks show.
A C-check on a Boeing 737, which is conducted after 12 to 18 months, costs airlines between $800,000 (N288 million) and $1 million (N360 million) per aircraft. This amount does not include the cost of ferrying the aircraft abroad and other charges.
On the other hand, carrying out a C-check in the Aero facility in Nigeria costs between N50 million and N60 million per aircraft. With an exchange rate of N360/$, airlines operating in the country will pay at least N7 billion to maintain the other 20 Boeing 737 aircraft outside the country, whereas carrying out C-checks in-country for all 23 aircraft at the cost of N50 million-N60 million will save airlines between N5.47 billion and N6.9 billion on maintenance.
But while Aero has been able to successfully carry out only three aircraft maintenance in 24 months, it has received approval from Ghana Civil Aviation Authority (GCAA) to conduct checks on their aircraft, Ado Sanusi, managing director and chief executive officer, Aero Contractors, told BusinessDay.
“In the past 24 months, we have done three C-checks for the airlines. We have saved huge amount as foreign exchange,” Sanusi said.
The Aero boss said an average C-check costs the airlines between $800,000 and $1 million, but Aero is carrying out C-check at N50 million-N60 million.
“It is now in naira. We have cut down the cost of ferrying the aircraft, the cost of over flight charges and the turnaround cost. We have carried out C-checks for a couple of local and regional airlines and we are in discussion with two regional airlines that want us to conduct two C-checks for them,” Sanusi said.
“We have also got the Ghana Civil Aviation Authority to conduct checks on their aircraft. We are talking to Niger, Cameron and Central African Republic and other West African countries for their maintenance,” he said.
Fourteen years after the liquidation of the former national carrier, Nigeria Airways, Aero Contractors, which is under the management of Assets Management Company of Nigeria (AMCON), was given approval to operate C-checks in its new maintenance facility. Before now, major C-checks were carried out in Israel, Jordan, South Africa, Ethiopia, Morocco and America.
Airline operators and stakeholders in the industry have applauded the initiative, saying it would conserve foreign exchange and reduce capital flight in the country.
John Ojikutu, member of aviation industry think tank group, Aviation Round Table (ART), told BusinessDay that domestic carriers are still taking their aircraft outside the country for maintenance because of unhealthy competition.
“All the domestic airlines are in competition with each other. Aero is in competition because it is still flying commercial aviation. This means the maintenance is additional money for them. If domestic airlines can go out and spend dollars, why can’t they do it here? They take the labour out when there are people in the country who can do it,” said Ojikutu, who is also CEO of Centurion Securities.
“Aero is the oldest airline in the country after Nigeria Airways. Why can’t we find a way to sustain the airline? They rather want the airline to die. No private airline has made it up to 10 years in Nigeria. They need to start seeing Aero as a partner rather than a competitor,” he said.
By IFEOMA OKEKE