No Nigerian Airline Made One Million Dollars Profit Allen Onyema Declares

The Chairman of Air Peace and Vice President of the Airline Operators of Nigeria, Allen Onyema, has declared that no indigenous airline in Nigeria managed to generate up to one million dollars in annual profit. Speaking at the 30th annual conference of the League of Airport and Aviation Correspondents in Lagos, Onyema provided a sobering breakdown of the financial realities facing domestic air carriers. His remarks challenged the widespread belief among members of the public that local airlines are reaping massive financial rewards from rising airfare prices across the country.

Onyema explained that even Air Peace, which stands as the largest airline operator and highest revenue generator in the nation, fell short of achieving a one million dollar annual profit mark. 

He pointed out that if the biggest operator in the country cannot hit that financial threshold, it is impossible for smaller domestic carriers to do so under the current economic climate. The statement highlights a growing concern that the entire domestic aviation market is operating under severe financial pressure, threatening the long-term viability of local air transport businesses.

A major factor driving down profitability is the heavy burden of taxes, duties, and statutory levies imposed on air carriers by various government agencies. Onyema disclosed that Nigerian airlines contend with up to 54 distinct taxes, fees, and charges across four major government bodies. At least six of these charges are directly added to the price of every passenger ticket, including terminal facility charges, security fees, excess baggage fees, and passenger service charges. According to industry reports, these accumulated taxes can consume up to 65 percent of an airline's overall operating income.

In addition to heavy taxation, local airlines face extraordinarily high interest rates when borrowing funds from commercial banks. Commercial loans for local aviation businesses have frequently carried interest rates as high as 29 to 33 percent, making capital expansion and aircraft fleet maintenance remarkably expensive. Combined with volatile jet fuel prices—which skyrocketed following global supply chain disruptions—the cost of keeping airplanes in the sky has reached unprecedented levels for local operators.

Onyema urged government policymakers to reconsider how they view the aviation sector. He emphasized that governments should not view airlines primarily as direct cash registers to generate immediate revenue. Instead, aviation should be treated as a strategic catalyst that drives the broader economy indirectly by facilitating business travel, boosting international trade, expanding tourism, creating direct and indirect employment, and strengthening national integration. Estimates presented at the event indicated that aviation contributes approximately 2.5 billion dollars annually to the Nigerian gross domestic product and supports more than 217,000 jobs nationwide.

To create a more sustainable environment, Onyema called for an immediate review and harmonization of aviation taxes and fees. Specifically, he advocated for the removal of the five percent Ticket Sales Charge and Cargo Sales Charge, suggesting that it should be replaced with a fixed unit charge to reduce the financial strain on operators. He further recommended that government agencies in the aviation sector be allowed to retain a higher percentage of the revenue they collect so they can reinvest those funds directly into upgrading airport infrastructure, security technology, and operational facilities rather than transferring profits out of the industry.

Other industry leaders at the conference echoed similar concerns regarding the future of commercial flight operations. Representatives of airport terminal operators and fellow airline executives agreed that without contractual stability, predictable policy frameworks, and a reduction in duplicated taxes, local operators will continue to struggle. 

The general consensus among stakeholders was that making the aviation sector profitable for private investors is the only reliable path toward lowering ticket prices, improving safety standards, and ensuring sustainable air travel for the Nigerian public.