A COMMUNIQUE ISSUED AT THE END OF AVIATION SAFETY ROUND TABLE INITIATIVE (ASRTI) WEBINAR HELD ON THURSDAY, APRIL 29, 2021.
THEME: UTILIZING INTERLINING & CODESHARE AGREEMENTS AS TOOLS FOR DOMESTIC AIRLINES’ PROFITABILITY & PASSENGER COMFORT
- The Quarter 1 Business Breakfast Meeting (2021 Q1BBM ) acknowledged flight cancellation and the perishability of unused seats as important challenges to trigger interlining and code-share agreements as tools for minimizing hardship experienced by passengers and the enhancement of airlines profitability , quality of service and revenue generation.
- The webinar acknowledged that interline and code-share are business decisions not to be initiated by regulatory fiat but noted the need for the endorsement by the NCAA as a regulatory body through the use of regulatory inducements and other strategic policies without compromising the stipulated annual economic audit on all domestic airlines to determine their state of health as Part 18 of NCAR enjoins.
- The webinar highlighted the expediency for Nigeria’s aviation supervisory authorities to compliment the safety with economic will, while airlines develop the willingness to embrace technical cooperation arrangements in order to exploit the huge profitability opportunities in the regional air transport market under such agreements.
- The webinar recommended the emplacement of a guaranteed payment processes such as Bill Settlement Plan (BSP) to enhance airlines’ cooperation while airlines embark on human capacity building for their staff on commercial agreements, negotiation, code-share, revenue management and applicable work ethics.
- For Nigerian airlines to be attractive to foreign carriers for code-share and other partnerships, it is recommended that operators be IOSA compliant, develop attractive route networks, ensure good product quality, develop the requisite commercial acumen and understand the contract terms of their engagement.
- Partnership and cooperation models work amongst airlines that consider themselves peers and whose operation are complimentary and that no single cooperation model fits it all. Therefore, domestic airlines should advance cooperation models that work best for the operations such as the model being implemented by Ibom Air.
- Compared to the cost of going through the IATA Clearing House system for settlement of airline obligations . The webinar advised that airlines should consider a local clearing system that addresses the current challenges of industry credit and place sales in a float account using solutions as the proposed One-Ticket solution where funds flow directly to the holder of the flown coupon.
- Nigerian banks have demonstrated the benefits of shared systems aimed at ease the convenience of their customers, this can be a model for the airline industry to facilitate the ease of the airline passengers in addressing options dues to extended delays and cancellations. Nigerian banks are ready, able and willing to leverage on extant financial technology services to facilitate airlines’ interline arrangements to attain the ease of transactions for payment and settlement.
Download Webinar Papers Here
- Interlining and Codeshare Agreements A Nigerian Airline Perspective – George Uresi
- Utilizing Interlining and Codeshare Agreement As Tools For Domestic Airlines Profitability and Passenger Comfort – Alexander Nwuba