Poor Arik Air, it is possibly going out of business or exceedingly diminished. Air Peace is also on life-support. While America prints dollars sharing with defenders of good-time capitalists – agents of share buybacks and big dividend payers to crony disciples – but messengers of bad-time decadely socialism, Air Peace and Arik are on their own in Nigeria. Yes, men who make $43 million per year because they “deserve all the pay” as they are building great companies, but quickly return to those they cannot pay $23k for help via bailouts, we see the paralysis in this world. Yet, as Arik cuts 90% of staff and reduces by 80% the pay of the remaining, I become jealous of the American model.
“With the current observed trend of events, it is prudent to lean on the assumption that the situation is likely to persist for a while longer. Of huge significance to us is that we have suffered a sharp decline of over 98 percent in our revenue streams since the suspension of our scheduled flights almost four weeks ago.
“Added to this is the rapid decline in the value of the naira by over 35 percent against the benchmark and with oil prices now falling well below $15 per barrel, it is evident that we must, without further delay, take decisive action to preserve our organization,” he said.
He added that the welfare of staff has always been paramount to the organization, but recent events have made these measures unavoidable.
“Our focus as management has always been hinged on the well-being and safety of our staff, managing our liquidity as an organization and creating the opportunity to ride out of inclement circumstances such as the one we are faced with today.
“Pursuant to this, recently, we reached out to our suppliers, specifically negotiating reduced rates on all our contracted services and mitigating operational expenses due to changes in demand. We also implemented contingency plans for staff and introduced operational support flexibility,” he said.
Nigeria will walk backwards without Arik and Air Peace. Unfortunately, Nigeria is looking for its own bailout from IMF, China, etc and cannot pick their phone calls. I am indeed confused, and ask “What Next for Arik Air?” Nigeria needs logistics and supply chain players – and something needs to happen, urgently. Arik and Air Peace should not fail!
As the airline industry across the world continues to take a beating following the suspension of most local and international flights, Nigeria’s largest commercial airline, Arik Air, on Thursday informed staff it would cut the salaries of its employees by a whopping 80 per cent.
In an internal memo obtained by PREMIUM TIMES the airline’s Chief Executive Officer, Roy Ilegbodu, informed employees that the management of the company has also decided that at least 90 per cent of its workers will proceed on indefinite leave without pay from May 1. 2020.
When reached for comment, spokesperson of airline, Ola Banji, succinctly confirmed the decision but declined to give further details
The memo below.
Source: Premium Times images