Allen Onyema, Chairman, Air Peace Airline
“Why Air Peace Might Not Survive Price War”
Yinka Olajoyetan, Lagos
Popular social media Influencer, Reno Omokri has said that except Air Peace gets Federal Government backing, the airline might not survive the ongoing price war with other leading airlines.
In a post titled: Can Air Peace Survive Emirates Return to Nigeria?, the populsr Table Shaker stated that the chief competitor for Air Peace will be lower-budget airlines, that can even sell tickets at a loss to squeeze out a rival.
“It is a fundamental error for Allen Onyema to see British Airways, Virgin, KLM, Lufthansa and other European airlines in that class as his competition. Those airlines are in the upper range of the global aviation industry and will nearly always be full on the Lagos-London, and Abuja-London routes. Why? Because Nigerians have become used to them and even see them as a status symbol. I don’t support that. However, I am a realist.
“The chief competitor for Air Peace will be lower-budget airlines, that can even sell tickets at a loss to squeeze out a rival. Airlines like Ethiopian Airlines, Egypt Air, Royal Maroc, Kenya Airways, Turkish Airlines, RwandAir, etc.
“During the xenophobic attacks in South Africa, I helped buy tickets for Nigerians fleeing South Africa, and the prices I saw for RwandAir do not make sense, even today. Those guys can charge almost nothing. It is hard to beat their price.
“And the reason these airlines listed above can offer rock-bottom prices is because they have the support of their governments.
“Without the support of the Nigerian government, Air Peace WILL lose the price war on the Lagos-London route. And they will lose not to British Airways (which is not a national airline). They will lose to Ethiopian Airways, Egypt Air, RwandAir, or Royal Maroc.
“If you go on Expedia right now, the only advantage that Air Peace has over these other non European airlines is that they offer a direct flight. Other than that, they are beaten on price. Will Nigerians pay higher for a direct Air Peace flight?
“The cheapest Lagos to London flight on Expedia is from RwandAir. Then Air France. Then Egypt Air. Ethiopian Airlines follows closely. Next is Kenya Airways.
“Let me shock you. Air Peace is not even on Expedia. And Expedia is the world’s largest seller of airline tickets. In 2023 alone, they sold a staggering $12.08 billion worth of airline tickets and hotel rooms. More than any website.
“Now, why am I saying this? The Federal Government is negotiating to get Emirates back into Nigeria. Why? Do they realise that Emirates is one of the most powerful airlines in the world, with a revenue of $29.3 billion for the financial year 2022-2023?
“What is the benefit of Emirates returning to Nigeria for our country? Already, Air Peace is losing the price war for the Lagos-London route to RwandAir, Egypt Air, Turkish Airlines and Royal Maroc, and you want to introduce Emirates into the mix?
“I know Emirates very well. It is probably the best managed airline on Earth. They can afford to sell tickets for a route at a sustained loss until they destroy their competition. They have the revenue and the reserves to sustain a temporary loss. If they return to Nigeria, Air Peace may become a sardine competing with a barracuda.
“Let us think this thing through. Except we do not want Air Peace to survive. Is it more important for Nigeria to get Emirates back than for Air Peace to succeed?
“I think our focus as a nation should be looking for ways to confer as many advantages as possible to Air Peace in this price war, so that they can succeed and turn a profit. The aviation industry is brutal. The profit margins are slim if you are not as big as BA or Emirates.
“Again, I urge that we should think this through. I know that Emirates left under Buhari because of inability to repatriate their revenue from Nigeria. Maybe that is the way to help Air Peace win this war. Perhaps Nigeria may make it not too hard, but also not too easy for foreign airlines to repatriate their revenues. That small ojoro, or mago-mago, can give Air Peace all the edge she needs to win this price war.
“How do you think all these other government-linked airlines are able to offer such ridiculously low fares? Their own governments do small wayo to help them. Let us not be naive!,” Reno Omokri stated on Friday via X
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