National Economy
Monday, August 11, 2025
  • Home
  • News
    • International Business
  • Lead-In
    • Cover
    • Investigation
  • Economy
    • Nigerian Economy
    • Fiscal Policy
    • Energy
    • Agri Business
    • Transportation
    • Industry
    • Competition
    • Homes & Property
    • Insurance
    • Companies & Markets
      • Companies
      • Capital Market
  • Tech
  • States & Politics
  • Commentary
    • Analyst
    • Business Matters
    • All Angles Considered
    • ClickSend
  • Editorial
  • Data
  • Others
    • Opinion
    • Money Guide
    • Analysis
    • Growth
    • Sport Economy
No Result
View All Result
Read News
National Economy
  • Home
  • News
    • International Business
  • Lead-In
    • Cover
    • Investigation
  • Economy
    • Nigerian Economy
    • Fiscal Policy
    • Energy
    • Agri Business
    • Transportation
    • Industry
    • Competition
    • Homes & Property
    • Insurance
    • Companies & Markets
      • Companies
      • Capital Market
  • Tech
  • States & Politics
  • Commentary
    • Analyst
    • Business Matters
    • All Angles Considered
    • ClickSend
  • Editorial
  • Data
  • Others
    • Opinion
    • Money Guide
    • Analysis
    • Growth
    • Sport Economy
No Result
View All Result
National Economy
No Result
View All Result
Home Lead-In Cover

Local Production Records Less Than 1% Of Annual Vehicle Imports

by Ngozi Ibe
3 hours ago
in Cover
Reading Time: 4 mins read
Local Production Records Less Than 1% Of Annual Vehicle Imports
Share on FacebookShare on TwitterShare on Telegram

You May Like

Despite Crackdowns, Onshore Gas Flaring Surges In Nigeria

MAN, Muda Yusuf, Labour, Others Clash Over Sale Of Refineries

Nigeria imports close to one million vehicles a year, yet local production supplies less than 1 per cent of that volume despite having capacity for far more, according to industry officials. Data from the Nigeria Auto Manufacturers Association (NAMA) showed annual demand at about 720,000 units, but domestic factories turn out only around 14,000 vehicles. Installed capacity is roughly 100,000 units, with utilisation stuck below 15 per cent, leaving output far short of potential and the market dominated by imports. Of the million vehicles entering the country annually, just 14,000 are brand new; the rest are mostly used cars. The import bill, estimated at $8 billion a year, is draining foreign exchange, a burden stakeholders blame on weak industrial policy and inconsistent enforcement.
More than a decade after Nigeria unveiled the National Automotive Industry Development Plan (NAIDP) in 2013, the policy still lacks the legal foundation that manufacturers and investors said is critical for stability.
In 2021, lawmakers passed the Auto Industry Development Bill, intended to give the Plan statutory backing and protect it from abrupt policy shifts. But then-President Muhammadu Buhari declined to sign it, offering no public explanation — a move that, industry executives said, has kept the NAIDP vulnerable to reversals and deepened investor unease.
Local assemblers including Innoson, Nord, Stallion and SAGLEV continue to operate, but executives and trade groups said expansion plans have been scaled back or deferred because duty structures and incentives are unclear and import exemptions persist.
The economic case for concerted action is reflected in projections from academics and consultants who study the sector. “A robust auto industry could contribute significantly to GDP, create thousands of skilled jobs, and reduce Nigeria’s $8 billion annual vehicle import bill. It could also stimulate backward integration into sectors like steel, plastics, electronics, and textiles,” said Oscar Odiboh, an automotive communication consultant and professor of mass communication at Delta State University.
Odiboh outlined detailed estimates of the sector’s upstream potential, saying original equipment manufacturing (OEM) of body shells from iron ore could be scaled substantially and citing specific value pools: lamps and chrome at N682 billion in 2024; rubbers to produce bumpers and tyres at N1.3 trillion in 2023; and glass from silica at N1 trillion in 2023. He also put forward an employment and recycling proposition, saying the sector could create massive youth employment through battery recycling. “This sector touches every Nigerian daily—through transportation, logistics, security, agriculture, and commerce—yet it’s treated like a luxury industry.We’ve been running an industrial plan based on goodwill. That is not sustainable. A floating policy cannot drive a grounded economy,” Odiboh said.
To break the policy deadlock, Odiboh proposed the creation of a National Automotive Economic Agency (NAEA) by executive order, capitalised with a $5 billion strategic industrialisation fund to accelerate localisation and attract global OEMs. He said he has developed two operational blueprints one for manufacturers and another for ministries, departments and agencies , to anchor implementation under a “Nigeria First” strategy. “The time for policy talk is over. What we need is policy traction, enforcement, accountability and results,” he said, urging the National Assembly to fast-track passage of the NAIDP bill. “We can’t keep delaying this. Investors are watching. Without legislative backing, we will lose another decade to policy drift.”
Academics and economists echo the warning. “Policy without execution is no policy at all. The NAIDP needs not just review, but real political will to drive it forward. Investors are watching,” said Professor Tayo Bello, a development economist at Adeleke University. A senior executive at a Lagos assembly plant, who asked not to be named, added, “We are at a crossroads. The government says it wants to promote local manufacturing, but inaction is hurting the very businesses it should be supporting.”
Industry analysts point to a set of entrenched commercial and political interests that benefit from the status quo. “There’s no doubt that vested interests profit from the current chaos. They don’t want a stable, structured environment that would level the playing field or introduce stricter standards,” said Charles Ajefu, an industry analyst in Lagos. He warned that a powerful lobby of used-car importers, some with political connections has an economic incentive to resist measures that would restrict imports or privilege locally assembled models. “They benefit from Nigeria’s high demand for cheap vehicles and see any shift toward a structured local manufacturing system as a threat to their market dominance,” Ajefu said.
Weak institutional alignment is another recurring theme. Dr. Samson Olaleye, a retired lecturer and strategist at Lagos State University, cited conflicts between ministries and regulatory bodies particularly the Ministries of Finance and Trade and the Nigeria Customs Service (NCS) over tariffs, tax waivers and the classification of semi-knocked down (SKD) kits versus fully built units (FBU). “This disjointed approach is sabotaging the country’s chances. We’ve been operating in uncertainty for years. It’s not sustainable,” he said.
The lack of policy traction is already affecting nascent segments such as electric vehicles (EVs). SAGLEV’s chairman, Dr. Gbenga Faleye, described operational setbacks tied to customs and finance. He outlined prolonged clearance times, misclassification under Harmonised System codes and difficulty accessing project financing, and said five containers of semi-knocked-down EV kits remain delayed at Nigerian ports, holding up deliveries to customers. Faleye argued that local EV assembly offers greater economic value than importing used cars because it creates jobs and transfers technical knowledge, and he highlighted that EVs have fewer moving parts, a factor that reduces maintenance complexity and operational costs. He called on government to accelerate charging-infrastructure rollout and to explore financing options to improve affordability for consumers.
Industry voices told NATIONAL ECONOMY that the cumulative effect of policy drift, weak enforcement and vested interests is measurable: lost investment, muted industrial linkages, and continued leakage of foreign exchange. With more than 70 per cent of vehicles on Nigerian roads reportedly imported second-hand, many observers said the country has become a dumping ground for older, environmentally inefficient models rather than a growing manufacturing base.
Regional trade dynamics add urgency. Under the African Continental Free Trade Area (AfCFTA), Nigeria theoretically has the market size to be a regional auto hub. But countries including South Africa, Morocco and Ghana have moved to lock in manufacturing through clearer legal frameworks and investor incentives.
“Harmonise government interests, pass the Auto Act, enforce import restrictions, and invest in infrastructure and skills. Without these steps, the automotive dream will remain just that, a dream,” said Mohammed, an industry stakeholder.
Until then, the industry waits at costly standstill between promise and paralysis.

Tags: Local Production Records Less Than 1% Of Annual Vehicle Imports
ShareTweetShare
Previous Post

Federal Gov’t Orders Fresh Probe Of Civil Service Recruitments Amid Job Racketeering Scandal

Next Post

Time To Invest In Nigeria’s Greatest Asset

ANOTHER GOOD READ

Despite Crackdowns, Onshore Gas Flaring Surges In Nigeria
Cover

Despite Crackdowns, Onshore Gas Flaring Surges In Nigeria

1 week ago
MAN, Muda Yusuf, Labour, Others Clash Over Sale Of Refineries
Cover

MAN, Muda Yusuf, Labour, Others Clash Over Sale Of Refineries

2 weeks ago
Nigeria’s ₦3.2trn Annual Outbound Medical Tourism Unacceptable –Experts
Cover

Nigeria’s ₦3.2trn Annual Outbound Medical Tourism Unacceptable –Experts

3 weeks ago
Tougher Choices Ahead For Nigeria’s Economic Rebound In H2
Cover

Tougher Choices Ahead For Nigeria’s Economic Rebound In H2

4 weeks ago
Foreign Artisans Taking Over Local Jobs
Cover

Foreign Artisans Taking Over Local Jobs

1 month ago
Nigerian Seafarers Decry Discrimination, Bullying On Board
Cover

Nigerian Seafarers Decry Discrimination, Bullying On Board

1 month ago
Next Post
Time To Invest In Nigeria’s Greatest Asset

Time To Invest In Nigeria’s Greatest Asset

Most Recent

Lagos Ports Modernisation:Time is Now!

Lagos Ports Modernisation:Time is Now!

August 11, 2025
Lookman Departs Italy Amidst Transfer Stand-off With Atalanta

Lookman Departs Italy Amidst Transfer Stand-off With Atalanta

August 11, 2025
CHAN 2024: Chelle Cautions Super Eagles B Against Early Home Return

CHAN 2024: Chelle Cautions Super Eagles B Against Early Home Return

August 11, 2025
Ordega Visits Survivors Of Yelwata Attacks, Donates Relief Materials

Ordega Visits Survivors Of Yelwata Attacks, Donates Relief Materials

August 11, 2025
Rent Upsurge Pushing FCT Residents To Brink Of Displacement

Rent Upsurge Pushing FCT Residents To Brink Of Displacement

August 11, 2025
Debt And Nigeria’s Revenue Challenge

Debt And Nigeria’s Revenue Challenge

August 11, 2025
ACF, Partners Allocate €10m For Cross-border Livestock Development

ACF, Partners Allocate €10m For Cross-border Livestock Development

August 11, 2025
FCTA Begins Procurement Process For Waste Collection In Satellite Towns

FCTA Begins Procurement Process For Waste Collection In Satellite Towns

August 11, 2025
Advertise with us

© 2024 | National Economy

No Result
View All Result
  • Home
  • News
    • International Business
  • Lead-In
    • Cover
    • Investigation
  • Economy
    • Nigerian Economy
    • Fiscal Policy
    • Energy
    • Agri Business
    • Transportation
    • Industry
    • Competition
    • Homes & Property
    • Insurance
    • Companies & Markets
      • Companies
      • Capital Market
  • Tech
  • States & Politics
  • Commentary
    • Analyst
    • Business Matters
    • All Angles Considered
    • ClickSend
  • Editorial
  • Data
  • Others
    • Opinion
    • Money Guide
    • Analysis
    • Growth
    • Sport Economy

© 2024 | National Economy