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Eight years after, Nigeria’s auto policy wobbles

Published

3 years ago

December 27, 2021

Stakeholders still await auto policy’s full implementation eight years after its introduction, FEMI OWOEYE reports

Although Nigeria’s auto policy was launched almost three decades ago (1993), a development framework was not initiated until two decades after (2013); that was under President Goodluck Jonathan’s regime.

The policy and its development plan were aimed at boosting the demand for made-in-Nigeria vehicles and encouraging Original Equipment Manufacturers (OEMs) to set up local vehicle manufacturing plants. Ultimately, it was expected to revitalize and grow the Nigerian automotive sector with a multiplier effect on the nation’s economy.

No doubt, as a result of the partly implemented policy, the sector, within the last seven years has not only generated an ample of employment, it has also grown with an installed capacity to assemble about 500,000 vehicles per annum.

To this end, the industry has attracted many OEMs such as Honda, Mitsubishi, Ford, Geely, Kia, Nissan, Hyundai, Sinotruck, Shackman, Dongfeng, XCMG, Peugeot, MAN, Yutong and FAW, which have opened investment lines to Nigeria, mostly in the form of technical partnership with Nigeria entrepreneurs.

The industry also generated direct investment by indigenous brands such as Honda, Innoson, Jetvan and Proforce.

However, due to poor policy administration and failure to implement certain essential provisions of the policy, it has suffered a summersault, recording constrained capacity utilization. That is why 28 years down the line, the nation’s auto industry stakeholders are still hopelessly awaiting full implementation.

Fielding questions from this writer, Mr Luqman Mamudu, former Director of Policy and Acting Director General of the National Automotive Design and Development Council (NADDC), reiterated that poor project implementation on the part of the Federal Government had caused a setback for the nation’s auto industry.

He said, “Seven years into its 10-year tenure, there has been practically no monitoring and evaluation of the policy, apart from initial sector report in 2016/17. All the associated programmes designed to create demand for vehicles assembled in Nigeria and grow local content have been abandoned by institutions responsible to do so.”

Moreover, auto finance provision, which in the original draft of the NAIDP was meant to grant affordable loans to Nigerians to acquire locally assembled vehicles, thereby creating demand and making the secondhand imports unattractive over the years, has been jettisoned.

As if that was not enough, the Federal Ministry of Finance, by Section 38 of Finance Act 2020, further worsened the situation by reducing the protective tariff for imported fully built unit (FBU) commercial vehicles from 35 per cent to 10 per cent, while imported semi knocked down (SKD) kits remain at 10 per cent.

“As a result,” Mamudu pointed out that “Nigerian ports and streets are now flooded with all manner of used commercial vehicles and cars with consequent depletion of the nation’s foreign reserves and a weakened naira.

“Sadly, although Nigeria has established tremendous capacity utilization in the commercial vehicle body building, now you do not have to build locally, just import.”

Following the invocation of the 2020 Finance Act, it has become more profitable to simply import vehicles for sale than venturing into local assembling.

Mamudu stated further, “Automotive assembly, especially final assembly, which dominates assembly activities in Nigeria, is certainly unprofitable to the assemblers compared to outright import. The protective tariff and levies are equally vexatious to many interests, as they wish to import freely.

“So, the implementation process needs to have been carefully managed to quickly ramp up to the CKD and components manufacture, where all would be happy.

“This is why the process requires close monitoring and adjustment to align with public concern. It is because there is no reasonable feedback that those who had earlier opposed the policy in the first place seem to be having the upper hand. The Finance Act 2020 with its devastating effects is one such example. It particularly accused the policy of slow or ineffective impact and set forth to remove the protective measures without consulting stakeholders.

“The implementation of the auto policy requires sacrifice from all in the interest of growing the real sector. But such sacrifice has its limit. The protective tariff was designed to be reduced as the industry gained traction, but it’s not being nurtured to do so.”

On the state of the NAIDP bill, Mamudu, who is now the Managing Partner, Transtech Industrial Consulting, said the last information he had was that the bill was under expert review.

In his view, however, the reviewed draft of the NAIDP should be shared for stakeholders’ input, particularly the Nigeria Automotive Manufacturers Association (NAMA) before its final passage and signing into law.

Being the largest economy in Africa, Nigeria has in the past six years been under pressure from the OEMs to complete the implementation circle of its auto industry development policy. The OEMs could see Nigeria becoming an automotive manufacturing hub of the continent.

But as of the time of putting this story together, the nation’s auto policy remains under a dark silence. Even stakeholders are also in the dark.

In the meantime, while importers of used vehicles and new fully built units smile to the bank, the nation’s economy bleeds.

– Nigeria Auto Journal, December 2021

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Nigeria’s firm, Weststar Associates, shines in Dubai, wins Daimler Truck EliteClass award

Published

4 days ago

March 23, 2025

Trends Admin

Nigeria’s firm, Weststar Associates, shines in Dubai, wins Daimler Truck EliteClass award

Weststar Associates Limited, Authorised General Distributor of Daimler Truck in Nigeria, has brought honour home all the way from United Arab Emirates specifically at the EliteClass 2024 Season Awards.

Daimler Truck Middle East Africa the Weststar team with the Silver Award in the Elite CSP (Customer Service and Parts) Performance category.
This is contained in a statement issued in Lagos, which added that the EliteClass 2024 Awards ceremony brought together 40 Daimler Truck Business Partners for a night of recognition and celebration.
Held at the One & Only Royal Mirage in Dubai, the prestigious black-tie event honoured top-performing general distributors that have demonstrated exceptional performance, dedication, and commitment to excellence in 2024.
The EliteClass 2024 Awards C
ceremony was the culmination of a year-long EliteClass programme for the Middle East and Africa measuring 24 categories across the entire business spectrum for Mercedes-Benz Trucks, Daimler Buses, and Fuso Trucks & Bus.
The awards highlighted the dedication and resilience of partners who have achieved outstanding performance and a remarkable commitment to excellence and contributed significantly to Daimler Truck’s success in the MEA regions.
President & CEO of Daimler Truck Middle East Africa, Mr. Michael Dietz, emphasized the importance of collaboration and performance-driven success during his opening address. “EliteClass 2024 is more than just an awards ceremony—it is a testament to the hard work, commitment, and shared vision of our partners.
“Their achievements continue to drive our brand forward, setting new benchmarks in customer experience and operational excellence across the region,” he said.
Weststar’s General Manager, Sales, Mr. Christopher Irumudomon, was present at the EliteClass 2024 Season Awards ceremony to accept the Silver Award in the Elite CSP (Customer Service and Parts) Performance category.
While presenting this award, the Daimler Trucks MEA leadership made the following statement: “Congratulations on your achievement in the EliteClass Central Africa 2024 Season. We are pleased to recognize your individual category achievement.”
The EliteClass 2024 Awards reaffirms Daimler Truck’s commitment to excellence, continuous growth, and the recognition of partners who drive success in an evolving industry landscape.
According to the statement, Weststar Associates Limited continues to fly the flag of the “brand with the star” high in Nigeria.
It said the company had remained the go-to home for all Mercedes-Benz needs in this region.
“With a dealership network that expands to the major regions of the country, along with highly trained and experienced sales and after-sales staff. Nigerians can rest assured that they will always have ‘the best or nothing’ at their disposal,” it stated.

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KIA, Access Bank launch special finance scheme for vehicle ownership

Published

4 days ago

March 22, 2025

Trends Admin

KIA, Access Bank launch special finance scheme for vehicle ownership

KIA Motors Nigeria in partnership with Access Bank Plc has unveiled a new finance scheme designed to increase vehicle ownership and affordability in the country.

The deal, according to a statement by the auto firm, offers flexible and affordable financing alternatives, enabling individuals, women, and businesses to own cars with ease.

The scheme features the all-new Kia Rio 2023, with repayment plans spanning five to seven years.

Marketing Manager, KIA Motors Nigeria, Omolade Akinyode, said, ”Dana Motors has been at the forefront of Nigeria’s automotive industry since 2002, providing exceptional automotive solutions and presently leading the charge for luxury electric cars, CNG cars and buses.

“Our partnership with Access Bank reinforces our commitment to supporting Nigeria’s economic growth, individuals, and women.”

She also said, ”Our core competitive edge in the auto industry is the offering of best in class vehicles at affordable prices and this retail financing scheme is a significant step towards promoting vehicle ownership in Nigeria.

”With a flexible repayment option of up to 48 months, equity contribution as low as 10% and over N6m discount and we are proud to be at the forefront of this initiative to make owning the all-new Kia Rio 2023 a dream come through for our Nigerian Customers.”

KIA stated that the car in the package, Rio 2023, is an award winning five-seater sedan, a fun car with a reputation for durability, reliability, comfort and fuel efficiency.

With safety features which include stability control, traction control, and multiple airbags, the all new KIA Rio 2023 is an excellent choice for customers who prioritize dependability in vehicle options,” it stated.

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NADDC DG hails Kojo Motors for establishing CNG conversion centre in Owerri

Published

6 days ago

March 21, 2025

Trends Admin

NADDC DG hails Kojo Motors for establishing CNG conversion centre in Owerri

Kojo Motors has partnered the National Automotive Design and Development Council (NADDC) in setting up the vehicle Compressed Natural Gas conversion centre in Owerri, lmo State.

Director-General of the NADDC, Joseph Osanipin, during an empowerment and awareness summit on Wednesday, March 19, 2025, commended the auto firm for the monumental project.

“Today, we are gathered here for Compressed Natural Gas (CNG) Empowerment and Awareness Summit 2025 with the theme ‘Building a youth-based nation through cleaner energy’,” he said.

Osanipin said that the the purpose of the summit was to create awareness and sensitize the public to safety, standards and regulation in the use of the CNG as a better alternative source of energy for mobility.

NADDC, he said, was equipping technicians with the knowledge, skills and competencies required to safely and efficiently convert vehicles to run on CNG.

“The Council is a parastatal of the Federal Government under the Federal Ministry of Industry, Trade and Investment,” he added.

“It has the regulatory oversight on the Nigerian Automotive Industry to initiate, recommend, supervise and regulate policies and programmes for locally manufactured vehicles and components in Nigeria.

The NADDC boss noted that the Council had worked tirelessly to ensure the survival and growth of this sector with a view to enhancing its contribution to the national economy.

As part of the CNG conversion programme, 60 technicians will be receiving hands-on training in converting vehicles to run on CNG which would run for five days from the March 17 to 21,2025.

Osanipin emphasized the importance of using certified conversion kits and specialized workshops to ensure safety during the process.

“The cylinders used in CNG vehicles are fortified, making them safer than traditional vehicle fuel tanks,” he said.

Also speaking during the event, Professor Anoka Njan, representative of the Minister of Industry Trade and Investment, praised the NADDC and Kojo Motors efforts, stating that the ministry fully supported the initiative as part of broader efforts to alleviate challenges in the auto industry and empower the youth.

Imo State Commissioner for Youth Development, Dr. Emeka Mandela Ukaegbu, who spoke at the summit on behalf of Governor Hope Uzodinma, emphasised the immense potential of the CNG in easing Nigeria’s transportation challenges and improving the economy.

“CNG offers a safer, cleaner, and cheaper alternative to the hardships many face in the country,” Dr. Madela said.

The administration is partnering with NADDC and automotive industry bodies to establish conversion workshops and CNG refilling stations across Imo State, ensuring that the state plays a key role in this important shift toward greener energy solutions.

The event marks a significant step in NADDC’s ongoing efforts to transform Nigeria’s automotive industry, making it more sustainable while creating new opportunities for skilled technicians and local communities.

Chinedu Oguegbu, Managing Director of OMAA, which is the vehicle brand promoting the petrol-powered to CNG conversion project, highlighted the economic benefits of running vehicles on CNG instead of petrol.

He listed the economic advantages to include savings up to 60 percent in the cost of fuel relative to dirtier options like diesel and petrol.

According to him, there is up to 90 percent reduction in knocks and carbon emission, and it is found to be healthier, cleaner and more environmentally friendly.

Besides savings in foreign exchange (FX) with abundance of gas locally, there is also massive resources in-country over 203 tcf of proven reserves that requires no refining and relatively lower investment for processing.

Nigeria has an estimated 15-20 million vehicles in operation that can be converted to dual-fuel or bi-fuel.

The OMAA boss reiterated the crucial need to provide an alternative to existing fuel system with the abundance of CNG as an option.

Delivering his goodwill message, Chino Ogwumike, the National Sales Manager at Kojo Motors, thanked the DG of NADDC for partnering with Kojo in this laudable project in Owerri, the heartland of the South-East of Nigeria and the government of Imo State for accepting to provide the land for building the CNG hub in the state capital.

Ogwumike stated that the flourishing automotive dealership with branches spread across the country under the visionary leadership of the founder and Executive Chairman, Ikenna Oguegbu, is strongly committed to contributing its quota towards the progress and development of Nigeria’s automotive sector and the economy.