The unveiling of the Nigerian Aircraft Leasing Company (NALC) Special Purpose Vehicle (SPV) by the Federal Government represents a significant milestone in improving access to aircraft for local airlines, according to aviation expert Samuel Caulcrick.
Speaking with The Guardian, Caulcrick warned that the initiative may struggle to attract sustainable investment without comprehensive reforms in the country's aviation operating environment. He described the concept of a Nigerian-backed aircraft leasing platform as positive, enabling domestic and regional operators to secure aircraft through a credible local institution rather than negotiating individually with international lessors.
Caulcrick noted that available information indicates the SPV is designed as a private sector-driven initiative, funded by local and international financial institutions, banks, and technical partners. The Federal Government's role is largely limited to providing sovereign guarantees and holding equity through the Ministry of Finance Incorporated (MOFI). While the sovereign guarantee addresses concerns about the security of invested funds, he emphasized that it does not automatically guarantee the returns investors expect.
Caulcrick, a former Rector at the Nigerian College of Aviation Technology (NCAT), Zaria, pointed out that Nigeria's aviation market still faces several structural challenges that could affect the leasing company's viability if left unresolved. These include sluggish passenger traffic growth, high operating costs, multiple taxes and charges imposed on airlines, absence of fuel hedging mechanisms, and the impact of economic pressures on passengers' disposable incomes.
He explained that these factors could undermine airlines' ability to generate the cash flows needed to meet lease obligations and ensure profitability for investors backing the SPV. Although the Federal Government is not injecting direct capital into the project, it still has critical roles to play in creating conditions that make the aviation sector attractive to investors.
Caulcrick urged government authorities to review regulatory charges, particularly the percentage-based Ticket Sales Charge (TSC), recommending a shift to fixed per-passenger fees that would better align regulatory revenues with industry growth. He also called for measures to reduce foreign exchange challenges facing airlines, including establishing a framework that would enable operators to access dollars for aircraft leasing and maintenance at predictable exchange rates.
Additionally, he advocated for a review of landing, parking, and navigation charges to bring them closer to regional benchmarks and improve airline competitiveness. Caulcrick recommended introducing a framework that would allow airlines to hedge against fuel price volatility or participate in bulk fuel procurement arrangements, noting that fuel remains one of the largest cost components for carriers.
He also approved the decision to structure the leasing entity as a Special Purpose Vehicle rather than a traditional corporation, saying the arrangement offers greater flexibility and enables the organisation to function as a centralised platform for aircraft acquisition and leasing.
