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Unions allege plans to ground Aero Contractors, retrench 40% of workers

By Wole Oyebade and Gloria Nwafor
17 May 2022   |   3:34 am
A coalition of aviation workers' unions yesterday, raised the alarm over alleged imminent plan to ground Areo Contractors airline and further downsize another 40 per cent of its workforce.

•Management denies claims

A coalition of aviation workers’ unions yesterday, raised the alarm over alleged imminent plan to ground Areo Contractors airline and further downsize another 40 per cent of its workforce.

The coalition, made up of the National Union of Air Transport Employees (NUATE) and the Air Transport Senior Staff Services Association of Nigeria (ATSSSAN), told reporters that the airline was already on its way to decommissioning following claims that its operating airlines and assets were too old to fly.

The management, however, said that the claims were unfounded and carrier was still on the path of recovery. Recall that the Asset Management Corporation of Nigeria (AMCON), in 2016, took over Aero Contractors as part of measures to stabilise the distressed airline. Though the carrier leveraged on its Aircraft Maintenance Organisation (AMO) for profitability, the airline arm continued to plunge in fortune and in 2017 downsized about 60 per cent of workers.

With the centre unable to hold, the unions accused the management of planning to reduce 40 per cent of its staff strength without consideration of redundancy, even as the company is yet to settle workers that were retrenched in 2016.

General Secretary NUATE, Ocheme Aba, and Deputy General Secretary ATSSSAN, Frances Akinjole, however, appealed to the National Assembly, Ministers of Aviation and Labour & Employment to initiate an intervention that could save both Aero Contractors.

Ochema said that reports from the airline that Aero’s aircraft were too old to fly were unjustifiable claims, adding that they were made to compel the airline out of existence.

Aba said: “The fact as we know it is that Aero operates the B737 Classic generation, the oldest of which just clocked 30 years. This class of aircraft is able to operate up to 85,000 cycles, or 100,000 flight hours as approved by the manufacturer, Boeing.

“None of these aircraft in Aero’s fleet has operated up to half of the approved figures. We stand to be proved wrong. While it is true that older aircraft do have higher maintenance costs, it must be borne in mind that the qirline owns an approved Maintenance & Repair Organisation (MRO) with elite engineers in its fold.

“Till date, there is no report from the MRO, or the Nigerian Civil Aviation Authority (NCAA) that any aircraft operated by Aero is too old to be maintained, or to fly,” he said.

The unions alleged ulterior motives by some hidden forces, whom they said alleged of engineering a phony lease contract with House of 5As to further distress the airline. According the unions, the airline operated the lease at a total loss due to sabotage.

Akinjole alleged that the same forces engineered the phony lease contract with House of 5As, which Aero was given only three seats in a 180-seater Airbus at a fixed price of N35,000 per seat.

“Whereas the contract was for the purpose of expanding the airline’s network, the leased aircraft somehow supplanted all Aero aircraft on its juicy routes, pushing Aero aircraft to fringe routes with limited passenger intakes.

“For the period that the lease lasted, the entire Aero Contractors was essentially working for House of 5As, as the lessor was making more money than the airline itself. No wonder the airline ran itself into deep financial crisis and began to owe salaries unprecedentedly.

“But for the intervention of the unions which threatened to direct workers to withdraw services to the leased aircraft, Aero would still have been under the bondage of the House of 5As contract. So, who arranged such a murky lease? And was it a deliberate ploy to bring the Airline down?”

The Managing Director of the airline, Capt. Abdullahi Mahmood, explained that every partnership was done with the aim of improving the revenues of the airline, particularly in relation to their unserviceable equipment and ensuring standard customer service.

“The question is what was our revenue before, during and after the exit of House of 5As? They (unions) should please respond. We are conscious of the challenges we are facing and have been prudent with our expenses, and doing our best to take care of staff welfare. We urge the staff and unions to desist from this attitude and support the company to overcome its challenges,” Mahmood said.

He added that the current management decided to create the four Strategic Business Units (SBUs): Maintenance Repair Overhaul (MRO), Aviation Training Organisation (ATO), Airline Operation and Rotary Wing, to enhance efficiency and profitability.

“There’s no Nigerian carrier without debt overhang caused by the operating environment. And all major airlines in the world have had similar challenges, but took strategic measures to turn around the airlines. It is unfortunate that the airline industry operates on thin margins and airlines are always making efforts to be leaner and smarter to stay afloat.

“Whatever management decisions are taken are usually done with the engagement of the unions. It is at the instance of the unions the Chief Executive Officer called for a Town hall meeting last week. We believe that as the revenues begin to improve over the next few months, following strategic engagements with potential partners, the airline’s fortune will improve.

“We recognise the huge and massive potential of Aero Contractors and are taking strategic steps to exploit them for the benefits of all stakeholders in these challenging times.”