Nigeria Air (Lagos) - the planned joint venture between the Nigerian federal government and an Ethiopian Airlines-led consortium - plans to start operations as early as October 2023, according to Ethiopian Airlines Chief Executive Officer Mesfin Tasew.
In an interview with Bloomberg TV, he said the airline would start with a combination of two wide-bodies and six narrow-bodies, but declined to specify. Well-placed insider sources told ch-aviation the initial fleet would comprise two B787s and six B737s, including B737-800 and perhaps some B737 MAXs.
However, the establishment of Nigeria Air still faces a legal challenge in the Abuja High Court from five private carriers under the umbrella of the Airline Operators of Nigeria (AON), which secured an interdict against the government late last year, stalling the finalisation of the joint venture and certification process.
The start-up has also been caught in the political change-over following Nigeria's general election in February 2023. The new president, Bola Tinubu, took office on May 29, 2023, and, together with the Council of Ministers, must still approve the public-private partnership (PPP) process to establish Nigeria Air. But in June, the new House of Representatives Committee on Aviation called for the suspension of the establishment of Nigeria Air and for legal action against those responsible for a demonstration flight by a Nigeria Air-branded B737-800 chartered from Ethiopian Airlines that caused a political uproar on the eve of the administration switch-over.
Nigeria Air's establishment is overseen by the federal government's Infrastructure Concession Regulatory Commission (ICRC). It will be a 51/49 PPP between the federal government and the consortium of Nigerian investors led by Ethiopian Airlines. But the ICRC cannot proceed until the legal process is concluded and the new Council of Ministers has blessed the joint venture. Only then can certification conclude, employees be recruited, and the first of seven B737-800s from Ethiopian Airlines be delivered, all of which have already been identified, well-placed insider sources have told ch-aviation.
The Nigerian government will own 5% of Nigeria Air. Ethiopian Airlines will control 49%, and the rest will be shared by Nigerian institutional investors, including MRS Oil Nigeria Plc, two companies in the aviation sector, "a big financial institution", among others, according to Zemedeneh Negatu, global chairman of Fairfax Africa Fund LLC. The Washington DC-based fund has raised USD250 million in equity financing for the airline and is considering accepting another USD50 million from "two large institutional investors", Bloomberg reported.
Operating an airline in Nigeria is "not a simple task [...] it will be a big challenge," Tasew said, adding that Nigeria holds USD82 million to be repatriated to Ethiopian Airlines. "We have people who know the business culture of Nigeria. We believe we can manage and develop the airline."
He said Nigeria Air would start with 15 domestic routes before expanding regionally and internationally to London (UK), New York (US), and Shanghai Pudong (China).
