Payday at Arik Air

[Oba1kanobe]

Arik is grounded by NAMA

While you guys are arguing "Good Arik / Bad Arik" from your comfortable arm chairs with a spot of tea in a first world country, Arik was shut down (again) today. This time, every domestic flight. All day. All grounded.

Five flights did depart Nigerian airspace for international destinations... 101 London, 105 Lagos / Abuja/London (apparently, 105 never departed Abuja for London), 071/075 Accra, 077 Dakar. It is thought that the J-burg flight will also operate tonight. New York and Monrovia are not scheduled for today.

All five of the flights that did depart were 6 to 10 hours late. About 100+ flights didn't go at all. Even if the government hadn't shut them down, the fuel payment situation would have made everything late, and many cancellations. The good news... with a reduced flight schedule, they don't have to cancel as many flights for lack of crew!!

I'm not sure how much longer this can go on. This was the month that salaries for pilots would be on time. After calling London today, pilots were told maybe on the 11th.

But, more bad news. The A330 is probably out of commission for 3 months. Apparently, whatever kind of warranty / lease / repair contract that normal airlines do with expensive turbofans, Arik elected not to. So, they will eat the whole expense. And, rather than pay for another Pratt to hang on there, and be flying in a week, they've decided on another plan which is so stupid, I can't bring myself to try and explain it here.

There are about 30 Airbus pilots on salary, sitting at home. Let's say they average $7500 per month in cost to the company (I'm sure it's higher than that); $225,000 per month, times three months.... $675,000+ just in salaries, with no income generated. Rent on the plane at about $20,000 PER DAY; About $1.8 million in lost rent for no revenue received. Dozens of cabin crew... $500,000 for 90 days? About $3 million total, PLUS Insurance, parking fees... AND THEN THE COST OF REPAIRS!!

$1 million... $2 million more? I didn't factor in "soft" expenses like 3 months of dead time on currency, so about half the cost of 6 month recurrent. More big numbers.

This, my dear colleagues, is a sinking ship. I have no idea if the planes will operate tomorrow. Or the next day. They can always do what they do best... buy another airplane with somebody else's money.