Air transport reversal drags industry performance as rising costs and weak demand weigh on recovery momentum…..
Nigeria’s aviation industry recorded a sharp downturn in the first quarter of 2026, contracting by 47.3% in nominal terms and marking its first major decline in nearly two years, according to the latest Gross Domestic Product (GDP) data released by the National Bureau of Statistics (NBS).
The contraction wiped out much of the gains achieved during the sector’s recovery phase in 2025, when air transport had posted strong expansion before gradually slowing in subsequent quarters.
The latest figures show that air transport generated N55.74 billion in Q1 2026, down from N105.77 billion in the same period of 2025, representing a decline of about N50 billion within a year.
The downturn marks the first nominal contraction in the subsector since Q1 2024, effectively ending seven consecutive quarters of growth.
It also highlights a steady loss of momentum through 2025, as growth decelerated from 57.21% in Q1 2025 to 30.60% in Q2, 2.88% in Q3, and 18.02% in Q4 before turning negative at the start of 2026.
The sector’s contribution to the wider economy also weakened, falling to 0.05% of nominal GDP in Q1 2026, compared to 0.11% in the corresponding quarter of 2025.
When adjusted for inflation, the decline appears even more pronounced. Real output contracted by 7.62%, worsening from a 0.81% decline recorded in Q1 2025. At constant 2019 prices, output dropped to N33.66 billion from N36.44 billion a year earlier, pointing to an actual reduction in activity rather than a pricing effect.
Despite the aviation slump, Nigeria’s broader transportation and storage sector continued to grow, posting a 6.51% nominal increase in Q1 2026. However, this represented a significant slowdown compared to the 53.56% expansion recorded in Q1 2025 and 39.62% in Q4 2025.
The transport sector contributed 1.36% to nominal GDP during the quarter, slightly lower than 1.51% a year earlier and 1.55% in the preceding quarter.
In real terms, the sector grew by 7.41%, although this also reflected a moderation from 14.08% in Q1 2025 and 21.25% in Q4 2025.
According to the NBS, transportation and storage accounted for 1.02% of real GDP in Q1 2026, marginally higher than 0.99% in the same period last year and unchanged from the previous quarter.
Analysts note that while logistics, road transport, courier services, and water transport continue to support the broader industry, aviation has become a key drag on performance, reversing the momentum built over the past two years.
The downturn comes amid growing concerns over the rising cost structure of the aviation industry. Operators have repeatedly warned that taxes, charges, and regulatory fees account for as much as 35% of airline revenues, putting pressure on profitability and operational sustainability.
Industry stakeholders argue that cumulative costs including ticket charges, landing and parking fees, cargo levies, and import duties on aircraft and spare parts continue to weaken the financial position of domestic carriers and limit growth prospects.
