Rising Costs Force Nigerian Airlines to Dip Into Reserves, Shareholders' Funds

The Nigerian aviation sector is facing significant financial strain, with United Nigeria Airlines (UNA) revealing that escalating operational costs are compelling carriers to deplete their reserves and tap into shareholder funds. This challenging situation has persisted for the past three to four months, intensified by the outbreak of the Middle East war.

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In the past three or four months since the war started, many people have ignored what the airlines have done to keep flying Nigerians from one destination to the other.

Osita Okonkwo, Managing Director of UNA, stated during a courtesy visit from Vanguard Newspapers that airlines have been effectively subsidizing passengers due to the high costs. "The costs are just so high that the revenue you make, you have to dip your hands into your reserves and into your shareholders’ pockets to make them fly," Okonkwo explained.

Despite the current difficulties, Okonkwo affirmed the airline's long-term vision. "We are here not for the short term; we are here for the long run. We know that it’s bad today, but tomorrow it will be better. And that is the hope we have in the economy and in the country, where we have made huge investments," he said.

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Basically, we have been subsidising everybody. The costs are just so high that the revenue you make, you have to dip your hands into your reserves and into your shareholders’ pockets to make them fly.

Adedayo Olawuyi, UNA's Chief Commercial Officer, welcomed the engagement with Vanguard, highlighting the airline's openness to partnerships that generate mutual value. He stressed the airline's interest in expanding its visibility and communicating its activities effectively to travelers, exploring collaborations across both digital and traditional media platforms.

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But we are here not for the short term; we are here for the long run. We know that it’s bad today, but tomorrow it will be better. And that is the hope we have in the economy and in the country, where we have made huge investments.