Abuja — Air fares have spun out of control as embattled Nigerian airlines draw up survival strategies against a surge in the cost of aviation fuel which suddenly escalated from N110 to N140 per litre.

LEADERSHIP Sunday investigation shows that airlines now increase fares at will, in what one industry operator called a survival strategy. Last Thursday, air travellers were shocked at the Abuja counter of IRS Airline as the company suddenly hiked fares to N20, 000 for the one-hour flight to Lagos.

An industry operator who would not want his name in print said that the number of passengers on the ground is now one of the factors that determine what an airline charges for any given flight.

During a rush period, if there is hot scramble for seats by intending passengers, airlines use the opportunity to hike their

fares, while the fares are normally reduced during off-peak periods, he said.

One of the problems imposed on Nigerian air travellers by the sudden surge in the cost of aviation fuel is that one could no longer predict the air fare until one gets to the counter of the airline.

The fare for a normal one-hour flight now ranges between N18, 000 and N20, 000 as against the former rate of N14, 000 to N17, 500 which had been the fare until a fortnight ago when the cost of aviation fuel went through the roof.

An air traveller who lamented the 'arbitrary increase in air fares' and blamed government for not minding what happened in the industry was told by an industry operator that a government that de-regulated the cost of aviation fuel has no moral right to dictate fares to airlines.

The cost of aviation fuel and diesel was de-regulated by the Olusegun Obasanjo administration in what was regarded as the first phase of the ill-fated de-regulation of the downstream sector of the oil industry. Under the policy, fuel marketers were allowed to import the two products and sell at market rates.

Obasanjo's reasons for de-regulating the price of aviation fuel was that air travellers are rich people and can afford to pay the market price for the service of the airlines. An attempt to de-regulate the price of the more popularly used premium motor spirit (petrol) met stiff resistance from organised labour which saw the policy as anti- people.

Aviation fuel in neighbouring Republic of Ghana sells for the equivalent of N90 per litre. However, fuel crisis in the aviation industry is a worldwide phenomenon engendered by the sudden rise in the price of crude oil to an all-time high of $135 per barrel a fortnight ago.

The International Air Transport Association (IATA) lamented last week that the global fuel crisis would worsen the dwindling fortune of the aviation industry. Profit margin in the global aviation industry had over the years remained very low and unattractive. In the last 60 years, airlines all over the world raked in a staggering $11.5 trillion in revenue but only managed to squeeze out a paltry $32 billion in profit during the period, an average profit margin of 0.3 per cent.

The Nigerian aviation industry is in even more dilemma than its counterparts in Europe, America and Asia. The industry is beleaguered by ageing aircraft which one industry source described as gas guzzlers.

While modern technology has churned out less noisy and more fuel-efficient airliners, most of the firms in the Nigerian aviation industry still parade the air with archaic Boeing 727 whose production lines were scrapped about 20 years ago. Others use the Boeing 737 - 200 series which is still regarded in the industry as a gas guzzler.

The 727 gulps down an average of 6,000 litres of fuel for the one-hour journey from Lagos to Abuja. At the current rate of N140 per litre, that adds up to N840, 000 for fuel alone. A full passenger load in a 727, at current air fare, would give the airline just above N2 million. Ironically, the airlines hardly get full load on their trips.

The airlines are losing on both ends by operating the gas guzzlers. The cost of maintaining the ageing aircraft is astronomical as spare parts are obtained in hard currency.

The more modern Boeing 737 - 400 series operated by Aero Contractors and Virgin Nigeria airlines uses about 4,000 litres of fuel on the same one-hour flight.

However, Arik Airlines has the most modern fleet in the Nigerian aviation industry. Besides the Regional jets, the airline has four new Boeing 737 -700 series in its fleet. The new jets are extremely quiet and more fuel efficient.