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Why ‘Nigerian Eagle’ can’t fly now

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The birth of the national carrier, Nigerian Eagle is shrouded in controversies over unresolved issues and conflicting date for takeoff.

ENCOMIUM Weekly’s checks within the industry revealed that  some of the unresolved  issues impeding the take off of the multi billion project include the settlement of the pension and liabilities of the defunct national carrier, Nigeria Airways Ltd. The pensioners have vowed that the airline would not fly unless they are paid.

Other issues raised include the Status of Registration, Air Transport Licence (ATL) and Air Operator’s Certificate (AOC) of Nigerian Eagle.

President of Aviation Round Table (ART), Capt. Dele Ore, said that he saw it coming. Adding that until they address the fundamental issues surrounding the establishment of the national carrier, the project would not see the light of the day.

Capt. Ore stated that one of the challenges the proposed national carrier is having is spiritual, noting that what is haunting the carrier is the ghost of the liquidated Nigeria Airways, whose workers have not been paid.

According to him, “It will never work. It is very simple; those of us who worked in Nigeria Airways Limited should be paid off.”

He pointed out that the new national carrier would not succeed because the carrier was crookedly set up by the Federal Government without the payment of their severance benefits and pension.

The aviation lawyer contended that until the Federal Government look into the plight of the workers of the defunct Nigeria Airways and pay them off like other workers of the carrier in Britain, the proposed national carrier will not succeed. “Until the Federal Government addresses the issue of the workers of the liquidated Nigeria Airways, whatever national carrier the government wants to establish is an exercise in futility,” he said.

 

Controversies that grounded the new national carrier

UNRESOLVED ISSUES

While the controversy rages, the investors behind the new carrier are still shrouded in secrecy. The equity ratio of government and the investors in the national carrier have also not been disclosed to the public.

Also shrouded in secrecy is the route allocation, which the Federal Government has tactically refused to talk about.

images (8)Just as stakeholders in the industry questioned how government came about the new national carrier and how it is going to work, the Minister of Aviation, Chief Stella Oduah, reportedly disclosed that the much talked about and controversial new national carrier was facing some challenges.

Before her disclosure, the Federal Government had always remained silent over the issue, despite the controversy the proposed airline had generated among stakeholders, analysts and aviation watchers.

Beyond that, it was not clear if the merging of Aero and Air Nigeria to become the new national carrier, Nigerian Eagle, was the national carrier the Federal Government has been talking about or if Nigerians should expect another national carrier different from the one being bandied about.

These are questions begging for answers:

Was the national carrier advertised, who are the directors of this company?

Which route is the carrier going to fly, has the national carrier interlined with any other international airline(s),when did it apply for Air Operator’s Certificate (AOC)?

When was it processed?

Did it go through the processes of securing AOC?

Based on the shaky foundation that the planned new national carrier was built on, stakeholders are of the opinion that the project will go the way of the liquidated Nigeria Airways Limited.

However, we learnt that the Federal Government has merged the debt ridden Aero, that is owing Asset Management Company of Nigeria (AMCON) $200 million (about N34 billion) with Air Nigeria, whose operations was grounded by the Nigerian Civil Aviation Authority (NCAA) for insolvency and who is also indebted to AMCON to the tune of N35.5 billion to form a new national carrier.

Due to the debt, AMCON acquired 60 per cent equity in Aero, while the Ibru family, who secured the $200 million, retains 40 per cent share.

Presently, Aero has about 12 aircraft, most of which are Boeings, in its fleet, while Air Nigeria equally had close to that number of aircraft in its fleet before it suspended operations.

Richard BrandsonTo start with, one of Air Nigeria’s aircraft, a Boeing 737 that is over 20 year old, was painted in the new national carrier’s colour, the Nigerian Eagle despite the very untidy arrangement.

The over 20 year old aircraft, a Boeing 737-400 with registration number 5N-BLC formerly owned by Air Nigeria was parked at one of the private maintenance hangars, Execu Jet, at the Murtala Muhammed International Airport(MMIA), Lagos .

It was also learnt that apart from the number of aircraft in the two airlines’ fleet, the Federal Government has placed an order for 10 aircraft with Brazilian manufacturing giant, Bombardier.

The delivery of the 10 aircraft, it was learnt, is expected to begin in March 2014. This fuelled the speculation that the take off of the Nigerian Eagle has been shifted till May 2014.

Based on this, stakeholders want to know why the debt that was incurred by private individuals is treated as public debt.

Minister of Aviation, Mrs. Stella Oduah, had told stakeholders that the proposed national carrier would be managed by private investors, while government would only provide enabling environment for the investors

pix20071203658693Industry watchers are keen to know if the AOC of Aero Contractor is transferable to Nigerian Eagle, and the recertification requirements of the new Nigerian Eagle. The stakeholders are also asking for the unveiling of the real investors in the new airline.

In its comment on the new development, Director of Research at Zenith Travels and former President of National Association of Nigerian Cabin Crew, Mr. Olumide Ohunayo, who queried the choice of Aero Airlines as the National Carrier, argued that the nation, through the action, would be plunged into deeper liabilities.

Ohunayo asked: “Why Aero Airlines of all the airlines in the country. We all know that all the airlines are owned by individual families. These individuals had mismanaged the airlines and ran them aground. Rather than converting the airline’s liability to public liability, AMCON should have put the airline on sale, so that the Federal Government would not have to bear the liabilities?”

The liability, according to him, would continue to escalate and outlive many administrations in the country. Similarly, President of Aviation Round Table (ART), Capt Dele Ore, who expressed displeasure over the manner the former national air carrier, Nigeria Airways, was liquidated without provision for pension liabilities of the workers, said he is not averse to the establishment of a new national air carrier as long as the pension liabilities of the pensioners of the defunct Nigeria Airways are settled.

On the issue that the formation of the new national air carrier did not follow parliamentary procedures, Ore said it was not an issue since the airline has been described as a private concern. He said the legislators have left unattended to what they should have given priority attention.

jimoh-ibrahimHe explained that since the liquidated Nigeria Airways was established by an Act of Parliament, it behoves on the legislators to ask questions regarding what led to the liquidation of the former national carrier, and why the legislative arm of government was not duly carried along prior to liquidation.

“The owners of this new national air carrier don’t have to resort to the National Assembly. The National Assembly has left what they should have done in the first place. It is the one that was liquidated that they should do something about. Because it was established by an Act of Parliament, and it should not have been liquidated without an Act of Parliament. So the new one that is being formed is not their business.

“They did not say it is owned by the government. They said government is only providing an enabling environment for it to take off. But we all know they are pretending.

“The president is being roped into it to come and launch it. What is the president’s business in launching an airline? Anything crookedly put together would go down crookedly,” he assured.

On the nomenclature of the airline – Nigerian Eagle,  Ore said since the name is the identity of anything, Nigerians must know how the name evolved from its former owner to replace Aero.

“In law, we say what is in a name? The name matters very much, because it is the identity. Did they buy that right? How did the name evolve from Virgin Nigeria to Nigerian Eagle and finally to Aero? We want to trace all that; and if they have not done all that is needed to be done, what they are doing now is called illegality.”

Ore continued: “We have to know how that name evolved. When was it negotiated; did they buy it; is it an amalgamation and so on? Let’s assume everything about the name is perfected; is Aero Contractor’s AOC transferable to the new air carrier? The answer is No!”

He further argued that if Aero is having a name change, was it advertised? Did they go through all the processes and have all the manuals and the trainings according to industry requirements? He also stressed that if nothing of such had been done, they have too many questions to answer.

“We were made to believe that the proposed national carrier would be handled by private investors, while the government would only provide the enabling environment for the investors. However, we now know that about ten other aircraft have been ordered from Bombardier Aircraft Manufacturing Company of Brazil by the government, and delivery is billed to commence from March 2014.”

It would be recalled that the name, Nigerian Eagle was officially announced in the Nigerian aviation industry on September 8, 2009, shortly after Richard Branson, the founder of Virgin Group withdrew its 49 per cent stake in Virgin Nigeria Airways.

Announcing the new name, the then Chief Executive Officer of Virgin Nigeria, Captain Dapo Olumide, at the presidential lounge of Murtala Muhammed International Airport, Lagos, said the airline was changing its name to Nigerian Eagle Airlines, adding that it was planning a private placement within the next six weeks.

“From today, the name of Virgin Nigeria Airways ceases after this presentation. You will see that we have created a brand. We intend to form an airline and create a brand at the same time. This is not done in the airline industry. This is a lot of work that had started in February, and it is just being concluded. One of the first things we did in Virgin Nigeria was to restructure the airline to stabilize, and to come up with a five-year-plan that would be sustainable. Today is the birth of a new airline. African aviation will only ever be developed by Africans,” Olumide had said.

The airline was also billed to adopt new uniforms, symbols and colours: the Virgin Livery was changed to a stylised eagle with the word Nigeria written in a unique font.

– FEMI OYEWALE

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