New vista for local aircraft maintenance in Nigeria
As domestic airlines continue to struggle with high operating cost arising from high cost of aviation fuel, multiple taxations, pilot trainings and aircraft maintenance, respite is finally on the way for them as Nigeria last week celebrated Aero’s multi-million C-Check facility.
BusinessDay’s findings shows that among all operating costs for airlines, aircraft maintenance is the most expensive and could wipe out over 65percent of airlines’ annual revenue.
Evident in this fact is the financial result of Medview Airlines Nigeria Plc last year which reported a 6.30 percent drop in third-quarter net profit as the company’s operating costs spiked on the back of maintenance costs incurred on newly acquired aircrafts.
For the first nine months through September 2017, the company’s net income fell to N1.19 billion from N1.27 billion the previous year.
While Medview’s sales increased in the period under review, the aviation giant incurred huge operating costs as the company spent money to maintain assets it acquired in order to increase share of the market.
Operating cost increased by 45.81 percent to N24.22 billion in the period under review while Aircraft maintenance surged by 1671.18 percent to N1.73 billion.
Analysts say the cost of maintenance wouldn’t have ballooned if aircrafts are maintained in the country as firms pay in foreign currency to buy and repair aircraft parts.
A C- check on a Boeing 737 which is conducted between 12 to 18months cost the airlines between 800,000dollars to 1million dollars. This amount does not include the cost of ferrying the aircraft abroad and other charges which will amount to over 200 thousand dollars.
BusinessDay’s checks show that out of the 26 Boeing 737 operating in Nigeria, Air Peace operates 12 Boeing737 aircraft, Azman operates four, Medview operates four, Allied Air has about three , JetAir operates one aircraft, and two other charter services operate 2 Boeing 737s.
This means Nigeria will be saving a huge sum of N7.93billion from the construction and usage of its own Maintenance, Repair and Overhaul (MRO) facility where nothing less than 26 Boeing aircraft will be carried out within a period of 18months.
It was therefore with great joy and expectations that industry stakeholders gathered at the Aero’s Maintenance Repair Overhaul (MRO) facility last week to celebrate the airline’s C-check maintenance facility.
Speaking at the occasion, Ado Sanusi, the managing director of Aero Contractors, attributed the feat to staff dedication, professionalism and hard work.
Sanusi said, “Today’s occasion proves that with good policies, smart management, effective oversight and professional dedication by staff, hard work gets rewarded and companies dedicated to public services can be revived from the brink of collapse”.
According to him, conducting aircraft C-Check in Nigeria is a huge milestone for the aviation sector adding that in Aero, there were several challenging moments.
“Thankfully, our Team of Engineers & Technicians persisted and surmounted the challenges to make today possible. This certification of Aero to conduct C-Checks in Nigeria seamlessly dovetails into the Ease of Doing Business Policy of the present administration. Aero hereby invites airlines to conduct their C-Checks for B737 Classics with us bearing in mind the tangible deliverables to be derived from patronizing Aero.
“These include saving foreign exchange, getting a quicker aircraft turn-around time, enriching Nigerian technical expertise and knowledge base and strengthening the Nigerian aviation sector as the regional and sub-regional hub for aviation activities. Aero hereby extends its hand in partnership to all,” he explained.
Sanusi, who called on the Federal government to assist Aero intervene with Customs to ensure that it expedite the easy passage and clearance of tools that are imported for imported for aircraft maintenance, said this would greatly help in avoiding loosing days waiting for Customs to clear our tools to enable us proceed with the maintenance.
He mentioned that though Aero has applied to be granted Free Trade Zone status at the Nigerian Export Processing Zones Authority (NEPZA), “we are hoping that granting us the status shall be expedited in the first quarter of 2018 as it would ease our maintenance turn-around time which is key to building customer confidence in patronizing Aero for its C-Check maintenance. We appeal to the minister to also intervene with the Minister of Trade & Investment”.
Also speaking at the event, Ahmed Kuru, managing director, Assets Management Corporation of Nigeria (AMCON), noted that the feat “justifies AMCON’s resolve and commitment towards the development and stabilisation of our challenged Aviation sector.”
Kuru said it is important to underscore the fact that Aero Contractors’ certification to conduct the C-Checks for Boeing 737-500 series locally is a boom for the industry because it would save millions of dollars that Nigerian Airlines and not just Aero, spend outside this country on facilities such as this.
“We cannot continue to allow capital flight of our scarce foreign exchange towards paying for services that are available in Nigeria and would provide a source of employment for our people. To this end a directive to other airlines towards the use of this facility at least to the extent of its capabilities and certifications, would go a long way towards ensuring the growth of the Aero MRO into being certified for other Aircrafts types”, he said.
The Minister of State, Aviation, Hadi Sirika said the facility would save airlines over $90 million in capital flight as C-check which hitherto was done outside the shores of Nigeria would now be done locally.
Sirika said Nigeria experiences huge capital flights of nothing less than $1.8million and $3million per Boeing aircraft on C-Checks.
“It is noteworthy that Boeing 737 aircraft are the most aircraft fleet operated in Nigeria by most indigenous airlines, prior to now and in the lifespan of other administrations. Nigeria experienced huge capital flight of nothing less than $1.8million and$3million per Boeing aircraft that left our shores for C-Checks and there are more than 30 of such aircraft operating so you do the arithmetic,” he said in his address.
IFEOMA OKEKE