No More N2.7m: Foreign Airlines Quote New Ticket Prices as Air Peace Begins Lagos-London Flight

• There are expectations that international airfares, which have started declining, will be reduced further
• The decline can be associated with several factors, amongst which is the depreciation of foreign exchange rates
• As a result, one-way tickets now cost between N1.03 million and N1.3 million compared to the N2.7 million it earlier cost

Legit.ng journalist Zainab Iwayemi has over three years of experience covering the Economy, Technology, and Capital Market.

Experts and stakeholders have predicted that international airfares will continue to decline despite the recent ticket price reductions of more than 50%.

Recall that foreign airlines in Nigeria started to unblock their low-priced tickets on Nigerian routes following the completion of the payment of about $7 billion backlog by the Central Bank of Nigeria (CBN).

The decrease in the fare was credited to several factors, including the depreciation of foreign exchange rates, the federal government's pressure on foreign airlines to offer cheaper tickets, and the start of flights to the United Kingdom on Saturday, March 30, by Air Peace.

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The resumption of Air Peace has broken the dominance of Virgin Atlantic and British Airways on the direct route between Lagos and London.

A 50% decrease in airfare

According to Daily Trust analysis, there has been a 50% decrease in airfare within the past six months.

The Lagos-London route remains a benchmark because of how frequently Nigerians go to the UK for business and education, among other reasons.

According to information obtained from British Airways, the UK airline, as of July last year, a one-way economy ticket from Lagos to London cost 2,698 pounds, or N2.7 million, at a conversion rate of N907 at the time.

However, the same airline's one-way ticket costs between N1.03 million and N1.3 million for travel during the first week of April, despite the increase in exchange rates to N1,300 as of yesterday.

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On Saturday, Air Peace reactivated Nigeria's bilateral air service agreement (BASA) with the United Kingdom by flagging off a direct flight to London-Gatwick.

However, checks indicated that the entry of Air Peace into the route has drastically reduced the fare, with major airlines quoting fares as low as $700 (N910,000 at N1,300/$).

The lowest price for a KLM one-way ticket from Lagos to London is $641 (N833,300), down from nearly $1,500 a few weeks prior. Turkish Airlines also provided a quote for April of $828 (N1.076,400).

Earlier, a one-way ticket on the same Turkish Airlines was sold for more than N5m. Virgin Atlantic's one-way ticket is N1.8 million. The lowest price offered by Lufthansa for the same flight is $941 (N1.2m).

Why airfare crashed

Travel experts acknowledged a sharp drop in airfare, which they attributed, among other things, to Air Peace's service launch.

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The National Association of Nigerian Travel Agencies (NANTA) verified that recent price reductions have occurred, attributing the crash to several main variables, such as a decline in the currency rate from N1,800 to N1,300 a few weeks ago.

Susan Akporiaye, president of NANTA, stated that further airfare reductions are anticipated in conjunction with a decline in the currency's value.

She said:

“The airfares are already coming down with the airline’s rate of exchange reducing to N1,300 as against N1,700 and N1,800. Now the fare that was over N2m before is now around N1m. We know that the rate of exchange is also a major part of it and of course, Air Peace’s coming in.”

How Nigerians are reacting

On social media X, Nigerians have expressed their excitement on the development.

@Kelechii_Imo stated,

"Let me join the rest of Nigerians to salute the Chairman of AirPeace LTd, Chief Allen Onyema for navigating through the storms after seven years and finally, getting Airpeace Nigeria to fly directly to London Gatwick."

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@asemota noted,

"Air Peace is the first time I have seen Nigerians jointly celebrating something that is cheaper than other options and not turning it into classism or broke shaming."

@iSlimfit said,

"Air Peace is bringing in 33 brand new aircrafts and also planning Lagos-New York and Texas routes before December. This is a worth celebrating on all fronts."

International airlines sell 'cheap' tickets

Legit.ng reported that since the naira appreciated, there has been a noticeable decrease in the cost of flight tickets from Nigeria to other nations.

The naira appreciation followed efforts by the CBN to settle debt to airlines involving verified and genuine forward requests.

Analysts believe that the CBN's action restores some level of confidence in the Nigerian FX system for foreign investors, especially in the aviation industry.

Source: Legit.ng