Aero shuts down flight operations indefinitely from Wednesday, July 20

Nigeria’s oldest private-sector operator in the aviation sector, Aero Contractors, has announced an indefinite suspension of all flight operations, from Wednesday, July 20, 2022.

Aero, Monday, explained that the decision is due to ‘challenging operating environment’ in the country.

The aviation firm, which has been under administration owing to debts, explained that the decision is due to ‘challenging operating environment’ in the country.

Aero is under administration, following takeover from their original owners by the Federal Government which placed the aviation firm under receivership of the Asset Management Corporation of Nigeria (AMCON) in 2016.

The airline industry has battled high operational costs owing to rising aviation fuel prices (JET A1), scarce foreign exchange, drop in general passenger demand, exorbitant airfares, lingering dispute with various labour unions over staff welfare demands, tax remittances, since emerging from the shutdown occasioned by the Covid-19 pandemic, last year.

On its decision to shut down operations, Aero Management said, however, that the move will not affect its other businesses such as the Approved Maintenance Organisation (AMO), otherwise known as AeroMRO, the Approved Training Organisation (ATO), also known as Aero Training School, Helicopter and its Charter operations.

The embattled airline management said that its partners in the Spring Alliance will assist to ameliorate the impact of the suspension on its affected customers to help them reach their destinations.

“Due to the impact of the challenging operating environment on our daily operations, the management of Aero Contractors Company of Nig. Ltd. wish to announce the temporary suspension of its scheduled passenger services operations with effect from Wednesday, July 20, 2022.

“This does not in any way affect the Maintenance activities of the Approved Maintenance Organisation (AMO) otherwise known as AeroMRO, the Approved Training Organisation (ATO) also known as Aero Training School, the Helicopter and Charter Services operations.

“This decision was carefully considered and taken due to the fact that most of our aircraft are currently undergoing Maintenance, resulting in our inability to offer a seamless and efficient service to our esteemed customers.

“We are working to bring these aircraft back to service in the next few weeks, so we can continue to offer our passengers the safe, efficient, and reliable services that Aero Contractors is known for, which is the hallmark of Aero Contractors Company of Nig. Ltd.

“The past few months have been very challenging for the Aviation industry and the airline operators in particular. With the high cost of maintenance, skyrocketing fuel prices, inflation, and forex scarcity resulting in high foreign exchange rates. These are amongst the major components of airline operations.

“In the meantime, we are working assiduously to return to service as quickly as possible, and do assure our esteemed customers and stakeholders of our determination, that our short absence will not create any major void in the market, as we are coordinating with our business partners to ensure minimum discomfort to ticket holders.

“As members of Spring Alliance (a commercial alliance with member airlines providing mutual support in the area of operations), we are liaising with our partner airlines to minimise the impact on our esteemed customers. Our customer service team will be working to help affected esteemed customers reach their destinations,” the airline said.

It would be recalled that in May, this year, the Federal Inland Revenue Service (FIRS) sealed off offices of the Aero Contractors over offences said to border on the failure by the airline to remit taxes amounting to about N350 million.

The closure of the airline offices came barely 24 hours after the National Union of Air Transport Employees (NUATE) and the Air Transport Services Senior Staff Association of Nigeria (ATSSSAN) called on the Federal Government through the Aviation Minister, the National Assembly, Minister of Labour and employment to intervene in the dispute at Aero Contractor and Arik Air to save airlines workers, their families and Nigeria’s aviation industry from imminent disaster

Arik is also currently under administration, following takeover from their original owners by the Federal Government which placed under receivership of AMCON.

FIRS officials claimed the operation to seal off Aero’s offices became necessary after several letters to the airline had failed to yield fruit, as the airline allegedly refused to respond to the tax agency’s communications.

Aero’s debt consists of legacy taxes that were not remitted before and after the airline was placed under receivership of AMCON.

It was however learnt that the embattled airline has paid about N50 million to FIRS and that the taxes, which led to the sealing off of Aero’s offices are not current taxes.

The airline, which is the oldest domestic operators in the country, has yet to respond to the FIRS action.

Also, in May, this year, a planned general shutdown of operations by all domestic operators under the aegis of the Airline Operators of Nigeria (AON) in protest over the high cost of operations in the country, was called off at the last minute following the intervention of the Federal Government.

AON members explained that the stay of action which prevented shutdown of the aviation services its deference to numerous calls from the highest echelons in government with promises to urgently intervene in the crises.

According to a statement by President of AON, Alhaji (Dr.) Abdulmunaf Yunusa Sarina, the airlines in the country currently face astronomic and continuously rising cost of JetA1, leading to high cost of operations and erosion of commercial margins.

The statement was jointly signed by the Executive Director of Max Air, Alhaji Shehu Wada; Chairman, United Nigeria Airlines, Dr. Obiora Okonkwo; CEO of Arik Air, Capt. Roy Ilegbodu; CEO of Aero Contractors, Capt. Abdullahi Mahmood; and MD, Azman Air, Alhaji Faisal Abdulmunaf.

The operators said the AON acceded to requests to withdraw the industrial action for the time being “while we allow for a fresh round of dialogue with government in the hope of reaching an amicable solution.”

“We have also reached this decision with the highest consideration for our esteemed customers who have been faced with uncertainty over the last few days and to enable them to have access to travel to their various destinations for the time being during the period of discussions with relevant authorities.

“In view of the above and in the interest of national economy and security considerations, AON hereby wishes to notify the general public that the earlier announced shutdown of operations on May 9, 2022 is hereby suspended in good fate pending the outcome of hopefully fruitful engagement with government.”