PRICE-FIXING ROW: Aviation expert faults FG on airline sanctions

By Dickson Omobola

Aviation expert, Gbenga Onitilo, Thursday, described Federal Government’s decision to penalise six domestic airlines over what it termed an arbitrary hike in airfares during the Yuletide as laughable, saying government’s response to the issue appears to be punishment before deep analysis of airline economics.

Onitilo said before sanctions would be issued, government should be asked the following questions: what has it done to support the survival of domestic airlines in the first place? Have there been targeted interventions when Jet-A1 prices spiral? Where are the FX support mechanisms for an industry that pays for aircraft leases, maintenance, insurance and spare parts almost entirely in dollars? When global shocks hit the industry, from fuel volatility to currency depreciation, what buffers has government created to stabilise the ecosystem?

Executive Vice Chairman of the Federal Competition and Consumer Protection Commission, FCCPC, Tunji Bello, during the ‘Meet the Press’ interaction organised by the Presidential Communications Team at the State House, Abuja, had said the airlines that exploited Nigerians during Christmas would refund the excess charges to passengers.

Onitilo, however, argued that rather than approaching the issue through collaborative industry dialogue, the FCCPC keeps using the term price fixing to describe the situation without a comprehensive disclosure of the underlying economics of seat supply, fleet availability, demand peaks and route profitability.

According to him, the real reform Nigeria needs is not sanctions, but a coherent national aviation policy that understands the economics of flight

His words: “‎The announcement that the Federal Government intends to sanction five domestic airlines over alleged Christmas price fixing is, frankly, laughable without a proper 360-degree understanding of airline economics. Aviation is not a roadside kiosk business; it is one of the most capital-intensive and volatile industries in the world. Yet once again, the reflex response of government appears to be punishment before deep analysis. The narrative that fares rose from around ₦400,000 to as high as ₦670,000 during the festive rush is being used as proof of manipulation, but demand spikes during predictable peak travel seasons are a global reality across aviation markets.
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‎”But the real question Nigerians should ask is simple: what has government done to support the survival of domestic airlines in the first place? Have there been targeted interventions when Jet-A1 prices spiral? Where are the FX support mechanisms for an industry that pays for aircraft leases, maintenance, insurance, and spare parts almost entirely in dollars? When global shocks hit the industry from fuel volatility to currency depreciation, what buffers has the government created to stabilize the ecosystem? Before sanctions are issued, these questions deserve answers.
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‎”Aviation globally survives through policy intelligence. Governments in the United States, Europe, China, and the Middle East understand that air transport is not just a transport service, it is economic infrastructure. That is why they deploy subsidies, tax waivers, bailout mechanisms, infrastructure investments, and strategic aviation funds whenever the sector faces systemic shocks. In Nigeria, however, airlines operate under the opposite conditions: weak airport infrastructure, high regulatory charges, multiple taxation layers, and severe foreign exchange exposure. The result is an operating environment where survival itself is a daily struggle.
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‎What is even more puzzling is the policy framing of this issue as “price fixing” without a comprehensive disclosure of the underlying economics of seat supply, fleet availability, demand peaks, and route profitability. Even the FCCPC’s own interim findings acknowledge that seasonal demand pressure, scheduling constraints, and fleet utilization can influence ticket prices during peak travel periods. Yet instead of approaching the issue with collaborative industry dialogue, the default policy instrument appears to be sanctions and refunds.
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“If Nigeria truly wants a healthy aviation sector, the conversation must move beyond punitive optics to structural reform. Airlines should absolutely operate transparently and competitively, but government must also recognise that aviation is an ecosystem, not a scapegoat. You cannot starve an industry of infrastructure, policy stability and financial support, then punish it for struggling to remain afloat. The real reform Nigeria needs is not sanctions; it is a coherent national aviation policy that understands the economics of flight.”

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