Nigerians spend N600bn on vehicle imports—Jalal


DIRECTOR-General, National Automotive Council, NAC, Mr Aminu Jalal, said that Nigerians spend about  N600 billion annually on  import of vehicles. Jalal informed  that about 50,000 new and 150,000 used vehicles were imported into the country yearly.

“Nigerians spend an average of N400 billion on importing passenger cars. By the time you add trucks and other vehicles, the amount Nigerians spend on imported vehicles will be running to N600 billion annually. The market is there.

Former NADDC DG, Aminu Jalal

“With this market, automotive companies will be willing to invest in the country, but the constraint is the inauspicious import duty which made the vehicles to be cheap.

“Our current policy structure encourages importation and discourages production. That is why we are trying to reverse it to something similar to what is obtainable in India and some other countries where it is easier to set up manufacturing plants than importing vehicles,” he stated.

Jalal said that the proposed  launching of Made-in-Nigeria vehicles in 2017 was no longer realistic due to unfavourable policy  that encouraged vehicle importation to the detriment of production. The Director-General  explained that the plan was initiated when  import duty was 30 per cent, but had now crashed to 10 per cent.

He described  the situation as unfavourable for investment, adding  that to produce vehicles locally did not mean that the vehicles would be 100 per cent made in Nigeria. “Our approach to a Nigerian vehicle is that the vehicle that is being assembled will have up to 60 or 70 per cent local content; then you can call it a Nigerian vehicle. Now to achieve that, you must first attract investors into the sector. The easiest way to do that is by putting in place the tariff that will discourage importation and encourage production of vehicles,” he said.

According to him, countries all over the world always give their companies a lot of protection, noting that South Africa’s import duty is very high to protect their indigenous companies. He said India made its duty as high as 300 per cent before reducing it to 91 per cent after the industry stabilised.

“Nigeria’s import duty is 10 per cent for commercial vehicles and 20 per cent for cars.  Right now CKD is imported at  five per cent. When the duty was introduced in 2005, many companies closed down. Until we change this tariff structure, forget about Made-in-Nigeria vehicle; nobody will invest in the sector,” Jalal said.

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