Individuals and corporates in Nigeria that want to buy private aircraft could lose as much as $600 million in non-refundable deposits to foreign manufacturers in the weeks to come, Business Day reported on Friday.
The losses will be a result of the aviation ministry’s review of private aircraft operations which might cause buyers to miss payment deadlines and forfeit advance payments, according to South Africa’s business daily.
The aviation ministry is reportedly currently studying the policy on the importation, operation and ownership of private jets in Nigeria. This is aimed at safeguarding correct registration, maintenance and monitoring of such aircraft, the newspaper said.
It is understood that some industry watchers believe there is a chance that this move will lead to a complete ban on private aircraft in the country.
The approval of applicants that want to buy private jets has been slowed down by the policy check.
Reports claims that there are over 60 awaiting applications at the Federal Ministry of Aviation, which could be impacted negatively since approvals were now on hold due to the anticipated policy.
“Many of the agents have deposited funds with companies in countries such as South Africa and the United States of America (USA), but we expect government to be up and doing in the review of the policy which is causing the long delays,” Business Day quoted one operator as having said.
“For instance, after 60 days, the non-refundable fee is lost to the manufacturer or the company and the jet might be sold to other interested parties,” the newspaper quoted a well-placed an industry source as having said. The source, according to Business Day, added that deposits are normally forfeited when there are delays in payment of the balance.
In 2007, Nigeria had only 20 private planes sitting in its hangars. Presently, records indicate an additional 130 private planes, valued at 1.02 trillion naira ($6.5 billion).
In the forth quarter of 2012, leading aircraft manufacturer Bombardier said Nigeria was its biggest market in Africa with about 35 Bombardier-made business aircraft currently flying its airspace; a growth driven by request from businessmen and leaders in the country. Two months ago, French private jet manufacturer Dassault Aviation, was also in the country to display some of its latest business aircraft.
Also, in January, US-based Cessna Aircraft Company displayed two of its latest aircraft – the Cessna Citation Jet 3 and Cessna Sovereign – in Nigeria at the Abuja airport and Murtala Muhammed Airport, Lagos.
The influx of aircraft manufacturers into Africa’s second-largest economy is an indication of the viability of the private jet market in the country, with reports pointing to Nigeria and China as two of the fastest growing private jet markets in the world.
