We lost $2m in 18 months over licence renewal –Adeniji, TAL boss

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Aviation business in Nigeria has often times been described as very challenging and unprofitable due to the policies and regulations of the Federal Government. One of such policies, which many domestic operators say it is frustrating and cumbersome,  is the process required to renew Air Operators Certificate (AOC) and the fact that it has to be done every two years.

Chief Operating Officer of Tropical Arctic Logistics (TAL), Femi Adeniji, in this interview accused government agencies of gross ineptitude and corruption, while alleging that officials of the Nigerian Civil Aviation Authority (NCAA) frustrated his company’s efforts at renewing its AOC, thereby causing it to lose over $2 million in 18 months.

Adeniji, a pilot and engineer is the first African American Director for Bombardier and first General Manager for Gulfstream.  He also worked at Falcon and was the Operation Manager for Embraer. He disclosed how government’s bureaucracy has made Nigeria’s aviation industry lose billions in investments which has now been diverted to Ghana and proffers solutions to the problems bedeviling the sector.

The Director General of NCAA seriously needs to look into the renewal of AOCs? Why do you have to renew licences every two years? Why do you have to go through the five steps? Every three or six months, you amend your manuals, so why are you still required to go through step one to step five when you want to renew? It doesn’t make sense. In the US, they come to every month to look through your manuals and every year, you are bound to do a comprehensive audit, the same thing in Brazil, Venezuela and other countries.

If you buy an aircraft that is registered Isle of Man, you submit all you books online, they look through it and will approve or not approve. The only reason they will come to you physically is if they need to inspect some equipment. But in Nigeria, everything is still handwritten. When I first brought my manuals, I brought it in CDs but the NCAA said it has to be printed out. I did that and submitted three times. The first time they told me that they lost them. We reprinted and submitted. We had to fight with some people there before they suddenly started bringing out the manuals saying they had now found them. There is no one that does business like that, you kill business.

Airlines can regulate themselves because when you set up an organisation, you have critical leaders like the safety manager, director of flight operations, director of maintenance, accountable manager that oversees everything that people do. All these people are licensed and it is their responsibility to make sure that everything that they do is right and meets the manufacturer and regulatory specifications. They are self-regulated on their own and one thing you should know is that no one wants to put his aircraft out there to go and crash.

However, with the Nigerian mentality, we believe that we can manage things to the end because we don’t have maintenance culture but that is where the NCAA comes in. They allocate you an inspector that monitors that particular operation and oversee what they are doing and by that, they are covering the safety aspect of it.

However, NCAA is inexperienced and I say that in the sense that most of the inspectors there went to University in Ukraine, they have not worked practically on an aircraft. It is anything that is written in the book that they follow. But in aviation, there is what we call grey lines, so if they are experienced and have business ethics, they would know that in accordance with the manufacturer, this is what is permitted or not permitted. But because of their lack of experience, they stick to the regulations and they make things very difficult for business owners. Sometimes, when they find out that you are even more experienced than they are, it becomes a challenge to them because they would feel like you are coming there to teach them their job. It is worse for people like us who came from the US because we speak freely.

There has been situations where manufacturers recommended a specific inspection and then NCAA said no. But the manufacturer says you can still fly for another six months with that component but NCAA would refuse. We don’t manufacture anything in Nigeria and some of us have worked with aircraft manufacturers so we know what we are talking about.

Government policies Some blame are on the management of the airline in that there are certain minimum requirements that the NCAA expects you to have but at the same time, you can’t compare someone that that has one aircraft with those that have five. The DG of NCAA can only do so much but he needs highly experienced lieutenants.

If I have anything that has to do with the AOC in the US, I don’t go to the FAA office, I send everything to them online and they call me if they need me. There is no staff that has worked in FAA that has not worked in operations before they are hired. The reason they do that is to ensure that they have ‘On The Field’ experience. There are no such bottlenecks in the UK, US and other countries the way it is in Nigeria.

One of the times I went to the NCAA office, I went to the extent of recording the conversation to tell you how frustrated I was. For 18 months now, our planes have not flown because we are have been trying to renew our AOC. From renewal, it has now turned into reissue. We applied for renewal long before the expiration date, unfortunately, Covid came in and they used that as an excuse that we can’t come to their office that we should send it online. Later on, they said they couldn’t find most of them. When they opened, we had to physically take the books there. Then the books got lost. We reprinted, sent another one. If any of your post holders resign in the course of what you are doing, you go back and start afresh.

At some point, I had to send my quality control manager to go and see them because it got a stage where they said they don’t want to see me again. In the course of doing that, they said the staff member handling our file has gone on training, so we had to wait because someone else cannot do it. We have lost well over two million dollars because we haven’t operated in 18 months. Thank God the chairman has another company that supports us, if not, we would have lost all our members of staff.

4READ ALSO: Strengthening the ease of doing business in Nigeria

Self-regulation

That is where the oversight and experience that I was referring to comes in. If you have an experienced NCAA oversight inspector, maintenance manager or director of engineering, frequent incidents would not happen in the first place. But because of the corruption in the system, we know what goes on there, the highest bidder gets things done. The decision on your operations is dependent on who is sitting in the NCAA at that point in time and your relationship with that person.

We need a spare parts depot in this country but the business environment here is not conducive. For instance, I spoke to Boeing and they agreed to open a depot where parts would be sold in Nigeria. But unfortunately, NCAA and even FAAN asked them to bring N35 million before a permit would be given. They told me its statutory fees.

 In Nigeria, once they see that you want to open a business, you are seen as a money bag but they don’t see the aspect of employment and the services that would be rendered. If anything happens to any of Air Peace aircraft for instance, they have to ground it if they do not have the parts. There are some parts called line replaceable equipment, but you can only have one or two of such. But if you have a large fleet of Boeing aircraft and there is a Boeing parts depot in Nigeria, you can easily go there and buy your parts because parts are stored based on the fleet of the country.

Authority

It’s about who you know. The chairman of this company, Emperor Baywood Ibe has a political connection. I have tried so many times and even he has tried countless times to get audience with the policy makers. If he had been successful, the parts depot business would have been set up by now. He wasn’t a political person but he had to join the All Progressives Congress to see if he could get these things done. It’s frustrating. I have another partner in the United States who wanted to come to Nigeria and set up a Maintenance, Repair and Overhaul (MRO) center but it was impossible.

There are 15 Nigerians that are doing very well in aviation in the US. I was the first African American Director for Bombardier, the first General Manager for Gulfstream and Operation Manager for Embraer. I was overseas for 37 years and my wife who is also a Nigerian encouraged me to return home and see how I can help the country. If I was a member of National Transportation Safety Board in the US up to the rank of Vice President and I did very well, the question then kept coming up to me asking why I don’t want to go and help Nigeria but when you come to Nigeria, you get frustrated.

Boeing is now trying to set up a company in Ghana and the US has given Ghana $2.5 billion grant for a feasibility study to set up an MRO, but it is Nigeria that is supposed to get that investment because we have the largest fleet.

Meagre profit

Part of the problem we have is that in Nigeria, the banks don’t understand the risk of aviation, so they run away from it and if they give you a loan, they do it with double digit interest rate. There is also the issue of availability of spare parts; UK has manufacturing companies around and Fedex and UPS goes there every day, so, we do have parts overnight.

Another huge problem is the value of the naira. When we started this business, we were supposed to be bigger than what we are now because we were supposed to do passenger operations and oil and gas. We approached Afriexim to get a loan at N250 to a dollar. Imagine if we had gotten the loan and we were paying back now, it would have been too much. There is also the issue of accessibility to foreign exchange.

The major issue why airlines in Nigeria don’t make it is that out of 24 hours, we only operate for eight hours during the day because of security reasons. There is what we call red eye flights where you can fly as much as you want from 7pm to 7am in the morning. That doesn’t happen in Nigeria, so you lose a lot of money because your aircraft is sitting on the ground. If you want to travel from Florida to California, you can leave in the night, finish what you want to do and come back because there are 24 hours flights. But in Nigeria, it is only during the day and even during day, you find out that the concentration of flights to place like Abuja is from 6am to 10pm. Between 10pm and 2am, nothing is happening and they converge again after that. There is no way you can compete with other countries with such timing.

Airport concession

I am in agreement in the sense that you hold the vendor responsible and you will get 99 percent efficiency. The FG is concessioning efficiency and service delivery. If your service is good, your airport is clean, people would patronise you. Nigeria is the only place where airports don’t make money, government gives them money to operate. Concession would bring efficiency so that if you are not doing well as a staff, I will tell you that I don’t need you.

Ways out

Things would change through benefits. I would look at the benefits they have and agree on a middle ground where we can meet. I notice that most things in Nigeria are run by the unions. The second thing is to get yourself away from politics and nepotism. If it is an Igbo man that can do the job, put an Igbo man there, if it is a Yoruba man, put him there. I’m a Yoruba man married to an Igbo woman, so there is now way you will sing songs of tribalism that would enter my ears.

Another problem we have is religion. How would you have a government establishment and you have a Church and Mosque there. The time when they are supposed to work is used to pray. It’s part of the inefficiency. You have Fridays and Sundays to do whatever you want to do.

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