Why Airlines Hardly Break-Even – Olajide, Airpeace Boss

Why Airlines Hardly Break-Even - Olajide, Airpeace Boss
Mrs. Toyin Olajide

Air Peace Ltd, a new entrant in the aviation industry, has already airlifted over 60,000 passengers within the three months of its operations. And, with her many years of experience in banking and aviation services, Managing Director and Chief Operating Officer of the airline, Mrs. Toyin Olajide, a chemical engineer, is in firm control. The energetic airline administrator actually started off as quality inspector with the Bellview Airlines, and subsequently moved to Dana Air as head of safety before pitching her tent at Air Peace Limited. Among other issues, Olajide spoke on opportunities and challenges for women in the aviation sector and how government can improve the ease of doing business in the sector.

It’s been said that flying planes is elitist given Nigeria’s growing middle class, what do you think airlines can do to change that impression?

THE emerging and existing middle class in Nigeria are mostly educated and better paid. There is no doubt that a large, expanding, enlightened and conscious middle class is healthy for the aviation industry despite the prevailing economic realities. However, if we expect more Nigerians to fly, air travels need to be more affordable with increased awareness. The only way to achieve this is if the overhead on the airlines is greatly reduced. The multiple charges imposed on the operators are too high for any airline to break even, let alone run profitably or recover their operating costs.

The Federal Government has been assisting the operators greatly, but should do more by prevailing on aviation agencies to cut down on the multiple charges imposed on operators. Even the elite these days don’t exactly fly economy class it is mostly flown by the middle class.

What, in your opinion, is the most critical issue government should fix in the aviation industry?

Government should subsidise aviation jet fuel as this accounts for 40 to 50 per cent of an airline’s operating cost, if the airline must break even.

Could you share your thoughts on the somewhat short lifespan of airlines in Nigeria and what does your company plan to do differently?

It is very disheartening because Airline business is a huge investment that may not be recovered within a short lifespan. However, our plan is to adopt intelligent, progressive, and aggressive marketing with a higher level of professionalism and operational standard than is the norm in the industry.

Embarrassing airplane crashes have been recorded in recent years, how do you hope to engender confidence in your own operations?

Safety is our most important performance metric, the number one core value and is fundamental to our overall operational and managerial excellence. At Air Peace, we understand that aviation safety begins with airworthiness of our fleet and that proper aircraft maintenance is essential for keeping aircraft and aircraft parts in optimal condition. Thus, ensuring the safety of pilots, crew, and our esteemed customers, is paramount. That is why for the maintenance of our fleet comprising four Boeing 737-500 sp and three Dornier 328 jets, we have a three-year contract with one of the world leading Aircraft Maintenance Organisation, BCT Aviation, UK.

To further express our enviable passion, support and commitment towards safety and to engender confidence in our operations, Air Peace Limited has signed a 5-year contract with Flight Aerospace Solutions Ltd (FLYHT) of Canada to be the service provider for our Automated Flight Information Reporting System (AFIRS 220), which has been installed on all our aircrafts for effective flight tracking, automated engine data monitoring for real time trending and satellite voice communications, all geared towards ensuring maximum safety on board.

We have also established a high level of operational safety oversight and quality control system that will ensure our operations and implemented standard operating procedures are in compliance with regulatory requirements.

Air Peace came into the industry with a very high standard. We want to do things differently. We don’t want to build anything less of standard, because when people came to us, they wanted to know who maintains our airplanes, who supplies our spare parts, what safety measures have we put in place and what makes Air Peace different? They wanted an operator that is ready, stable, and not erratic in any way and which they can rely on. They found that reliability in us.

We have invested and continue to invest in Air Peace with best calibre of staff in the industry. We are one of the best-paying airlines in the industry, because we want to be the best hands. We have actually gone out to get the best hands, with good relationship with our customers. You can see this with how the customers relate with staff. We understand that we have a job to do and we go out to do it every day for our esteemed customers. That is what the Kebbi State Government saw that motivated them to want to do business with us.

Air Peace is barely three months in the aviation industry what is your assessment of the state of affairs so far?

First, we give Glory to God Almighty for the journey so far. It is a very competitive industry however, Air Peace is not in competition with any operator but exists to provide superior service to customers. Air Peace has come to stay. Our operation has been very safe and very stable. Our passenger load in the last three months has been very impressive and a huge success. The traffic is taking an upward trend and our philosophy is to continuously improve our services and sustain the momentum. We listen to our customers, because we understand that we have a job to do and we are going to be doing it professionally every day to satisfy our esteemed customers.

What really is Air Peace bringing on board, given the ever-present challenges faced by operators?

Air Peace Limited comes on board with a higher level of professionalism and operational standard, providing safe and high-quality services that create superior value to our esteemed customers in every aspect of air travel experience. We concentrate on our passengers’ satisfaction and safety, with highly trained, dedicated, and professional personnel, caring for our passengers, their needs and want. We maintain flexibility in our operations that enables us to always respond and adapt to changing market conditions and opportunities, without being erratic, and employing equipment, scheduling, and staffing on a basis that is sufficient to get the job done properly and efficiently.

As a new airline, you operate Lagos, Port Harcourt, Abuja, Asaba, Owerri, Enugu and Kebbi routes why only Kebbi in the north?

A lot of people in Kebbi were used to going to Sokoto to fly, because they didn’t have an international or commercial airport. But the present government has built a standard airport the runway is amazing, and they have four airlines in operation. Even, ILS airline has its base of operation there.

We are operating in Kebbi because the desire of the state government was for us not to base our operations out of its territory. It was worried that indigenes in the state and surrounding states went to Sokoto and Kano to travel.

In fact, a lot of businesses in Kebbi didn’t have a commercial airport to fly for their trips outside the state. But now we have a scheduled operation since last year, first of which was the Hajj. When they approached Air Peace, we went there, had discussions with them and carried out our audit. We were surprised at what we saw.

They had a launching last year and we were there. It was a big event. We actually started a contract with them which was to run for three months with one of our jets, a 32-seater. We did very well. It flew from Abuja to Kebbi, and Kebbi to Abuja. It is a scheduled flight that we do four times a week. It was started in December last year.

Then, in January this year, because of the increase in passenger traffic, they came back for a tweaking of the contract, that they wanted us to bring our base into Kebbi. We have signed it and are now conducting our Kebbi operations with our Boeing fleet. That is enough to meet up with the traffic. We are doing a lot of awareness.

With the many challenges, including overhead and operational costs, would you say you are breaking even?

I wouldn’t say we are breaking even. It is impossible to say that you are breaking even, having done just three months in the business. This is because you have to look at the fixed and variable costs accrued. At the moment, we are looking at trying to meet up with operating cost. We have been doing very well and have broken records in this industry.

Within this short period, we have airlifted over 60,000 passengers. That is obviously a record, to have been accomplished in less than three months. We hope to do better. Continuous improvement in our operations is our philosophy. We don’t believe that we have arrived. We always endeavour to be better, even above industry standard that is our goal.

As a new entrant, you should be very much in the season of hiring staff what do you say of the pool of personnel?

Air Peace understands the very crucial importance of an organisation’s personnel to its success, and a total familiarity with, and commitment to the overall vision, mission and goals of the company. From our management team, we have very experienced and highly professional team who combine vision, realism, financial ability and solid knowledge of the aviation business. We devote a great deal of time and attention to hiring personnel.

Our personnel are trained to ensure a friendly, cooperative, enjoyable, yet highly professional face to the customer. They treat customers and other staff in a friendly and respectful manner. Our hiring process is rigorous and includes behavioural interviews and peer assessments. We carefully select, train and maintain a flexible and diverse workforce of caring, passionate, fun, and friendly people who want to provide our customers with the best flying experience possible.

There was something we did with our technical staff when we started operations. We had to send them for assessment to test their technical skills, assertiveness, mental stability in the cockpit and their attitude to flying. We checked all these out and have a report on the assessment. Many of the crew came out with good records. Not just that, we also have our own minimum standards in hiring staff. We do a review with our parameters to measure whoever we want to employ. We make sure that they meet up with our standards. We try to get the best. We ensure that they are technically, mentally and socially competent.

If they don’t possess good social skills, for instance, how would they interact with customers? We want to give customers an experience that they would like to come back to.

All these have to come as a total package in every of our staff. We understand that continuous training for technical, and even ground staff, is key to any effective operation. So, we have mandatory, continuous and also periodic training for staff. We have our plot of carrier progression within the company. Training is essential for us because we want to be sure that our staff is competent enough to deliver the responsibility allocated to you.

As a young Nigerian woman in such a top aviation management position, what really are the opportunities for women in this sector?

The opportunities for women in this industry are endless. We have experienced women, who have made history in the aviation industry as pilots, engineers, businesswomen and entrepreneurs. On 31 December 1934, Helen Richey won a contest against eight male pilots to become a co-pilot for Central Airlines, making her the first US woman to pilot an airmail transport aircraft on a regular schedule.

Janet Harmon Bragg was the first African American woman to earn a commercial pilot’s rating. She and other black students formed the Challenger Air Pilot’s Association and built their own airport near Chicago. Southwest Airlines President and COO, Colleen Barrett, is the US airline industry’s highest-ranking female. Well-qualified women are now employed in every aviation-related job, and I encourage more women to take up the challenge, irrespective of gender discrimination and become professionals in Aircraft Maintenance and Engineering, Flight and Ground operations, Safety and Quality.

Are there specific challenges faced by women in the industry, and how can they be surmounted?

Yes, there are pre-existing barriers that may be influenced by cultural, technological, financial and social factors. Women aviators face challenging beginnings while adapting to the different duties and stresses of a rapidly changing industry. There is likelihood for gender discrimination on the job. There is also the challenge of working long hours that prevent enjoying a successful career while raising a family.

However, to surmount these challenges, it is important to prioritise goals, make a list of these professional goals, and talk to several people in the industry on how to achieve them.

Any specific challenge(s) in your running Air Peace as new airline?

It has been challenging, but at the same time interesting. Majorly, the challenge I feel operators face in the industry is infrastructure and support for operations to be seamless. For example, at the airports, you need equipment to work properly. However, I know that the Federal Government is doing its best to resolve all of those.

There has been huge improvement in the industry. And I have a good team working with me the synergy has been good.

Source : The Guardian

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