Controversy Erupts Over Alleged Price Collusion: Aviation Specialist Criticizes Government's Punishment of Airlines

Aircraft expert Gbenga Onitilo has criticized the Federal Government's decision to penalize six domestic airlines for increasing airfares during the Yuletide, labeling it as laughable and lacking in-depth analysis of the airline industry's economics.

Onitilo posed several questions to the government, including what support it has provided to domestic airlines, whether it has intervened when Jet-A1 prices surge, and if there are foreign exchange support mechanisms in place for the industry, which largely pays for aircraft leases, maintenance, insurance, and spare parts in dollars.

Tunji Bello, Executive Vice Chairman of the Federal Competition and Consumer Protection Commission, had stated that the airlines that took advantage of Nigerians during Christmas would be required to refund excess charges to passengers.

Onitilo argued that the FCCPC's approach to the issue is misguided, as it focuses on price fixing without considering the underlying economics of seat supply, fleet availability, demand peaks, and route profitability.

According to Onitilo, the government's announcement to sanction domestic airlines over alleged Christmas price fixing is laughable without a comprehensive understanding of airline economics, which is a highly capital-intensive and volatile industry.

The narrative that fares rose from around ₦400,000 to as high as ₦670,000 during the festive rush is being used as evidence of manipulation, but Onitilo noted that demand spikes during peak travel seasons are a global reality in the aviation industry.

Onitilo emphasized that the government should be asked what it has done to support the survival of domestic airlines, particularly in times of global shocks, such as fuel volatility and currency depreciation.

Air transport is not just a transport service, but also economic infrastructure, and governments around the world, including those in the United States, Europe, China, and the Middle East, provide subsidies, tax waivers, and strategic aviation funds to support the industry during systemic shocks.

In contrast, Nigerian airlines operate in a challenging environment with weak airport infrastructure, high regulatory charges, multiple taxation layers, and severe foreign exchange exposure, making survival a daily struggle.

The policy framing of the issue as price fixing, without disclosing the underlying economics of seat supply, fleet availability, demand peaks, and route profitability, is puzzling, and even the FCCPC's own findings acknowledge that seasonal demand pressure and scheduling constraints can influence ticket prices.

Onitilo advocated for a collaborative industry dialogue, rather than the default policy instrument of sanctions and refunds, and emphasized that airlines should operate transparently and competitively, but the government must also recognize that aviation is an ecosystem that requires support and stability.

The real reform Nigeria needs, according to Onitilo, is not sanctions, but a coherent national aviation policy that understands the economics of flight and provides the necessary infrastructure, policy stability, and financial support for the industry to thrive.