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By Chinelo Obogo
As tongues wag over recent hike in airlines’ ground handling charges by 260 per cent, the immediate past Managing Director of Skyway Aviation Handling Company Limited (SACHOL), Basil Agboarumi, has strongly defended the move, saying it took into consideration the rising operational costs and the depreciation of the naira.
In an exclusive interview with Daily Sun, Agboarumi shed light on the financial pressures confronting ground handling companies, noting that while their revenues are earned in naira, essential equipment and spare parts must be procured in foreign currencies.
He emphasised that before the 2021 adjustment, ground handling charges had remained unchanged for 35 years, a situation he described as unsustainable. According to him, the increase was not only necessary to keep operations afloat but also crucial for upholding safety standards in the aviation sector.
“Prior to 2021, there was no increase for 35 years. Do not also forget that our spare parts are not produced in Nigeria. Our services are paid in Naira. It will become a major challenge for us. The services we render are generated in Naira, and about 90-something percent of our equipment and spare parts are sold from abroad. Before the pandemic came, we were buying diesel—10,000 liters of diesel at the end of the month. Every time we bought diesel, it cost us about N4.5 million to N5 million. By the time we came back from that pandemic, the cost of diesel had gone to over N20-something million.
“The aviation industry is like a human body. Just because you want the left to survive and you destroy the hand, the left will still feel the pain. There must be a balance,” he said.
The dispute between ground handling companies and Nigerian airlines began late last year when ground handling companies, citing rising operational costs, increased their safety threshold handling rates by 285 per cent.
Prior to this increase, the NCAA-approved rates in 2021 were N70,000 for Boeing 737, N50,000 for CRJ and Embraer flights, and N25,000 for Dash 8 flights. The Airline Operators of Nigeria (AON) resisted the 285 per cent increase, arguing that the new rates were unsustainable. They demanded a 20 per cent reduction, while ground handling companies insisted on a 10 per cent reduction. However, last month, the Nigerian Civil Aviation Authority (NCAA) intervened to broker peace between the two warring parties. After a series of meetings, both sides agreed to a 15 per cent reduction in the new handling rates, bringing the overall increase down to about 260 per cent.
Despite the challenges, Agboarumi expressed optimism about the future of ground handling in Nigeria. He called for greater collaboration among stakeholders and urged the federal government to extend concessions to ground handling companies, similar to those granted to airlines. “The challenges are real, but with unity and fair practices, we can build a sustainable aviation industry,” he stated.
On his tenure as the MD of SAHCOL, Agboarumi described how he navigated the company through economic crises, including the COVID-19 pandemic, which devastated the aviation industry globally. “I came in during a crisis period. The dollar all of a sudden went from 360 to, before our eyes, N400, N500, N700, and to over N1,000. And of course, at the time I was leaving, it was almost a thousand plus. Despite these obstacles, we continued to invest in the latest equipment during my tenure,” he said.
He said that under his leadership, SAHCOL successfully acquired major clients, including British Airways, Ethiopian Airlines Cargo operations in Lagos, Green Africa, Ibom Air, and Uganda Air. He noted that he challenged the monopoly previously enjoyed by SAHCOL’s major competitors in the ground handling business.
“I was the one that took SAHCOL to the Stock Exchange. We operated during one of the toughest economic periods in Nigeria’s history. Yet, we not only survived but thrived and made a profit. We brought British Airways. It was like a joke from the competitor to us. It was a time of the pandemic. As I was leaving SAHCOL, British Airways was renewing another five years with us. All through my time at SAHCOL, we didn’t lose any clients. I think it was the first time NAHCO knew they had a competitor. Before then, it was just about them,” he said.
He said one of his most significant contributions to the industry was spearheading the formation of AGHAN (Association of Ground Handlers of Nigeria), which united previously fragmented ground handling companies. He revealed how he coined the name and acronym AGHAN and explained the challenges ground handlers faced before forming the association. The former MD described how this lack of unity put ground handlers at a disadvantage when dealing with airlines, particularly regarding payment collection.
“The challenges that ground handlers suffered in Nigeria were that everybody was going solo. And so, the airlines were united, either as the AON or the foreign airlines. They had associations, but we didn’t. When they owed us money, they would run to NAHCO, then they would owe again, and when you tried to collect the money from them, they would run back to SAHCOL. But through AGHAN, ground handlers gained a collective voice in the industry,” Basil said.
On his plans for 2025 and beyond, Basil said he would launch two new business ventures on April 1, a public relations agency focused on the travel and tourism sectors and a restaurant chain in Lagos.
“I’m doing a lot, and by the grace of God, we’re now setting up our own agency. We’re doing two things on the 1st of April. First, we’re launching our public relations agency. Second, we’re venturing into the restaurant business by setting up a restaurant in Lagos, starting with an outlet on the Island. If you look at where we’ve come from, I’ve been in travel and tourism forever. Our public relations agency has a bias for travel and tourism.
“When it comes to food, based on our global connections and experiences, it’s clear that food is one of the things nations want to showcase at conferences. Our desire is to showcase African cuisine and what we can do with traditional African food, and that is exactly what is driving us into the food business. We are coming up somewhere around Lekki, and we are opening one around the Lagos Business School. We will see how we can make a statement with something African—our way of selling Nigeria and selling Africa,” he said.
