“Aero Contractors has announced that it would suspend its scheduled services from Thursday, September 1, 2016 and the development is part of the strategic business realignment to reposition the airline and return it to the part of profitability,” Akinkuotu said in a statement yesterday
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He said, “the impact of the external environment has been very harsh on its operational performance, hence management’s decision to suspend scheduled services indefinitely effective September 1, 2016 pending when the external opportunities and a robust, sustainable and viable plan is in place for Aero Contractors to recommence its scheduled services. The implication of the suspension of scheduled services extends to all staff directly and indirectly involved in providing services as they are effectively to proceed on indefinite leave of absence during the period of non-services,” the Chief Executive Officer stated.
The airline, in recent years, had been under AMCON’s receivership following its inability to repay some of its debts to creditor banks in the country. Daily Sun learnt that Aero Contractors’ exposure to AMCON and other creditor financial institutions in Nigeria is in excess of N30 billion. It was also learnt that from a fleet of over nine aircraft, which serviced both domestic and regional routes, Aero’s aircraft fleet had shrunk to just one in the last one month, an indication that the airline was drifting towards insolvency.
Only last month, Aero had pulled out of the Accra route owing to its inability to muster the requisite finances to undertake mandatory maintenance checks on its aircraft on that route. It was also learnt that a foreign carrier, which had leased one of its aircraft to Aero had recently cancelled the lease deal and ordered the airline to return the aircraft.
Akinkuotu said, “the airline has faced grave challenges in the past six months, which impacted its business and by extension the scheduled services operations.”
Reacting to the development, stakeholders in Nigeria’s aviation sector expressed shock and disappointment over Aero Contractors decision, noting that the exit of the airline would have dire consequences on its teeming passengers, staff, the Nigerian aviation industry, regulatory and service providers, as well as the larger economy.
Most analysts agreed that fares would go up, especially on those routes Aero was plying either as the leading or second most important carrier in terms of number of passengers carried everyday.
Renowned aviation analyst, Mr. Chris Aligbe, who spoke with Daily Sun yesterday said, “the indefinite suspension announced by Aero Contractors tells a very sad story of the state of the Nigerian aviastion sector today. This is a very sad day for the aviation industry and for numerous flyers of the Aero Contractor brand. This is one of the longest serving local carriers and I pity the staff who had worked all their lives in this airline hoping it will bounce back to life.”
Aligbe, however, expressed the fear that if urgent steps were not taken by the Federal Government to address the numerous challenges facing the domestic airline industry, other airlines may go down the way Aero Contractors did.
“Airlines are faced with multiple taxation, fuel and forex scarcity, among other challenges. The government is asking the agencies to recover debts. What is going on is like a killer virus and I am afraid other airlines may go the way of Aero,” Aligbe said.
Secretary General of the National Union of Air Transport Employees (NUATE), Mr. Olayinka Abioye, who also spoke with Daily Sun blamed the tragic demise of Aero on “the reckless and poor practices of its management. We sympathise with about 467 workers already penciled down for disengagement by the airline. Aero’s problems had nothing to do with the staff but with the management and the Ibru family who for years owned a majority equity in the airline before AMCON took over from them,” said Abioye.
“Today is a very sad day for labour if AMCON, which took over this airline could not make it work well for the industry. What has now happened makes it imperative for the Federal Government to come to the rescue of all ailing airlines by compelling the CBN through AMCON to re-fleet the airlines,” he added.
Uto John, who said she’s a frequent flyer on Aero lamented the plight of the airline imploring the government and other relevant agencies to wade into the issues that brought about the airline’s suspension and see how best to assist it resuscitate within the shortest possible time.
“I have been in tears since I heard the news of Aero suspending its scheduled operations. I have been flying the airline for the past seven years to different destinations in Nigeria and I can’t imagine it’s gone,” John added.
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