In Nigeria, a significant dispute has emerged between ground handling companies and local airlines over a new charge related to safety in ground handling. This disagreement has caught the attention of the Nigeria Civil Aviation Authority (NCAA), which has attempted to mediate the situation. The acting Director-General of NCAA, Captain Chris Najomo, convened a meeting with both parties to address the issue, but unfortunately, his efforts did not lead to a resolution. As a result, he has instructed the airlines and ground handling companies to hold another meeting to try and come to an agreement by Wednesday.
The crux of the issue lies in the introduction of a new tariff by ground handling companies, which has seen a dramatic increase in fees. After reviewing their charges for the first time in three years, these companies decided to raise their safety threshold fees significantly—by around 200 percent. This increase aims to align their charges with those seen in many other African countries. If this new charge is implemented, airlines could find themselves paying between N200,000 and N300,000 for handling a Boeing 737, a steep rise from the previous fee of N70,000. For smaller aircraft, like the CRJ, handling costs could also jump to between N150,000 and N250,000.
Over the past three years, domestic airlines in Nigeria have raised their ticket prices by over 700 percent, while ground handling companies had not adjusted their charges until now. Currently, the handling fees stand at N70,000 for a Boeing 737, N50,000 for CRJ and Embraer aircraft, and N25,000 for Dash 8 flights. The airlines have expressed their frustration with these new charges, especially in light of the rising operational costs they face, including multiple fees imposed by the government.
During the recent meeting, representatives from the Airline Operators of Nigeria, which represents local airlines, voiced their dissatisfaction with the newly proposed charges. They argued that they were not adequately consulted prior to the introduction of these new fees. The airlines believe that the proposed increase represents a staggering 600 percent hike, which they find unacceptable.
In response, the ground handling companies defended their decision, claiming that they had conducted the necessary consultations before implementing the new charges. They asserted that the increase was not as extreme as the airlines suggested, stating that it was closer to a 300 percent rise. They attributed the need for this increase to the continual depreciation of the Nigerian naira against foreign currencies, which has made their operational costs more burdensome, especially since much of the equipment used in ground handling is imported.
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Aero Contractors’ Managing Director, Ado Sanusi, has publicly condemned the handling companies for what he perceives as an arbitrary increase in fees. He warned that such a drastic rise could have dire consequences for Nigeria’s already struggling aviation sector, exacerbating the challenges it faces. This sentiment reflects a broader concern that the increased costs could deter passengers and further destabilize the industry.
In the midst of these discussions, aviation consultant Chris Aligbe weighed in on the situation, refuting claims that the ground handling companies are involved in price-fixing or operating as a cartel. He pointed out that there are multiple handling companies in Nigeria, including Butake Handling Company, Skyway Aviation Handling Company Plc, and Nigerian Aviation Handling Company Plc, and that they do not coordinate their pricing strategies. Aligbe emphasized that while there may be variations in handling charges, the notion of a collective effort to inflate prices is unfounded.
As the deadline for a resolution approaches, both parties are under pressure to find common ground. The ongoing clash over ground handling charges highlights the complexities of the aviation industry in Nigeria, where rising operational costs and regulatory challenges continue to pose significant hurdles for airlines and service providers alike. The outcome of the upcoming meeting could have far-reaching implications for the future of air travel in the country, affecting not only the airlines and ground handling companies but also the passengers who rely on these services.
