Q: Can the local airlines adopt price cutting instrument or strategy as it were to uphold their clientele and still remain competitive in the domestic market?
A: In as much as price is an integral part of competition, it would be suicidal at this time because the fares abinitio are uneconomical for the new modern fleet being introduced into the market and this will continue to undermine profitability and threaten long term survival of the airlines. To the consumer though, it is a welcome development provided the regulatory authority, Nigerian Civil Aviation Authority (NCAA) does not overlook its safety oversight functions to ensure flights are secure and safe. However, era of stiff competition with survival of the fittest and elimination of the unfit concept is rather belated. Nigeria is still the only country that has remained where aviation world was during the early 1970s because we were never ready to liberalize just as we are yet to liberalize power, oil & gas, rail, etc till now. The world has moved on to alliances and mergers. One can only hope it will not take another 30 years for us to see the sense in been proactive with our national policies. Nigeria must deliver four mega carriers soonest.
Q: Baring in mind the economic downturn currently rocking global economies including the aviation industry, how in your view can the local airlines weather the storm and yet maximize profit?
A: Nigeria Airlines must see the sense in alliances, pool partnership, blocked seat / code share agreements, schedule harmonization and or merger. The Airlines must deploy modern IT solutions that are helping mega carriers and depart from rule of the thumb in decision making. It will definitely improve the bottom-line. Sabre air Vision for instance, allows the airline to plan passenger and cargo offerings, discover the right mix of schedule (and not just fly to Abuja because Aero is doing so). We can also develop a unique brand, maximize revenue and compete.
Q: Some stakeholders as well as aviation analysts in the country have suggested that the federal government should provide an intervention fund for the industry. To what extent is this option viable?
A: Nigerian Airlines who has weathered non liberalization era of government for upwards of five years need the following: (1) Financial bailout and not intervention fund through debt forgiveness by NCAA, FAAN, NAMA, etc. (2) Economic Bailout through FLY NIGERIA ACT which will ensure all travel on public funds is made on a Nigerian flag carrier (3) Introduce measures that will compel merger into mega carriers like the banks. Our airlines put together today are still less than the defunct Nigeria Airways. We’ve been experiencing growth by substitution. To be a mega carrier on intercontinental route for instance, we need a measure that will stipulate minimum operating fleet of about 50 aircraft within the next 24 months.
Q: What is the implication of low passenger and cargo traffic on the rising cost of operation in the domestic airline sector?
A: Uneconomic tariff using most modern equipment erodes return on investment much more than load factor because some of the aircraft at full capacity and even if it were possible to load passengers on the wing outside will still not breakeven. Nonetheless, if our carriers can begin to cooperate and harmonize their schedules, marginal waste can be curtailed through load factor offerings.
Q: What are the potentials of the local travel industry?
A: Air Travel Industry potential in Nigeria is simply terrific, where road is permanently a suicide mission, and in the absence of rail and sea options.
Q: Would you canvass merger of weaker domestic carriers?
A: Not only weaker operators but all the operators. Due diligence must be done to ensure long term success of union for two or more operators with different ideologies.
Q: Can you lead us into Sabre Travel Network?
B: Sabre Holdings (comprising of Sabre Travel Network, Travelocity, Sabre Airline solutions) is the world’s largest US based provider of software products, passenger solutions, and consulting services for Airlines. Sabre Nigeria is the first point of call in Africa. Sabre hosts 400 Airlines (American AA, Delta DL, United Airlines UA, British BA, Air France/KLM, etc) 64,000 hotels, 32 car rental companies, nine cruise lines, 35 rail and 220 tour operators. Since launch in Nigeria, Sabre has connected upwards of 400 travel agents in Nigeria and hope to put all the 550 IATA agents online before mid 2010. Sabre Nigeria has been producing fresh manpower for the industry which is facing acute shortage especially in the area of commercial workers.
Q: And who is Mr. Gabriel Olowo?
A: Gabriel O. Olowo, Fnim have had an uninterrupted stint of 36 years in Nigerian aviation with a humble beginning as management trainee with Lufthansa German Airlines. I was the first Nigerian General Manager with Varig Brazilian Airlines and my last posting was as Executive Director, Bellview Airlines till I retired five years ago. Mr. Olowo is presently Nigerian representative of Sabre Network Ltd and he is married with grown up children and grandchildren. I play golf, love reading and listening to humorous jokes.