Ground handling firms are under stress – no thanks to the recession-the Managing Director of Nigerian Aviation Handling Company (NAHCO), PLC, Mr Nobert Bielderman, has said.
Bielderman, at a briefing over the weekend, said the impact of the recession was forcing operators to embark on cost-cutting initiatives to enable them keep their operations afloat, adding that the firm has to diversify its operations to reduce pressure on its core business at a time some airlines are either cutting flights or withdrawing their operations from Nigeria.
He said NAHCO had to diversify into freight forwarding as well as setting up an export processing zone to beef up the revenue profile of the group.
In addition, he said, the firm has adopted other strategies including monitoring of fuel consumption and domestication of some mandatory training programmes to reduce operating cost.
The cargo firm boss listed the exit of Aero Airlines from the domestic scene as one of the factors affecting its operations, saying that Aero was indebted to NAHCO. He said the firm might be constraint from pursuing any ambitious expansion plan in other countries in Africa in the meantime, because of the difficulties in securing operational licences.
Bielderman said the firm was not directly affected by the challenges in securing foreign exchange because some of its services are paid for in foreign currencies.
He said: ”We are enjoying slight advantages with the challenges others are grappling with as it affects access to foreign exchange. This is because some of our income is generated in dollars, but it is albeit, affecting us in the area of costs. This include payment for insurance premium, procurement of spares and operational equipment as well as expenditure on offshore training.
“We are pursuing drastically a cost cutting strategy by ensuring that some of our training programmes are now done locally.
” The truth is that the economy is generally not doing very well. The recession is not going to isolate anyone. As you may have noticed, many airlines are pulling out of Nigeria. A lot more airlines are reducing the number of their flights into the country. Only recently, the Federal Government had to come out to beg departing foreign airlines to please come back.
This is not the best of times for the aviation sector in Nigeria.
“Even so, as an operator in this sector, we have no doubt that should there be a consolidation exercise in the sector today, NAHCO would be one of the very few companies that would scale through.’’
He said the firm is not losing business, but attracting more clients in the cargo handling value chain, where it is consolidating over 80 per cent of the market share.
He said NAHCO is doing well and not losing any business.
“Let us correct the impression being made out there. We can state without any fear of contradiction that we have gained more businesses. Despite the high volume of misinformation going round, the facts of the situation on the ground stand out that NAHCO now controls 80 per cent of the domestic market, a bigger share than ever before.
“The only local airlines that NAHCO does not handle are Arik and Medview. NAHCO handles every local airline, including Azman Air nationwide. We handle 90 per cent of international market and our market share is still growing.
“The only viable international airlines we do not handle are South African Airways (SAA) and Etihad. This year alone, we have won Meridiana Fly(Italian Airline),Mid-African Airlines, RwandAir, on Abuja – Kigali route; Mainstream Aviation, Cronos – Lagos. Also, all our airline standard ground handling contracts are perfect and in full force.