According to a report by Vanguard on Monday, 1, 07, 2024, Automakers and assemblers have urged the Federal Government to inject an urgent N100 billion intervention fund into a vehicle finance scheme aimed at assisting Nigerians in purchasing new vehicles and revitalizing the industry.
They argue that this initiative would also accelerate economic rejuvenation.
This call was made at the Nigeria Auto Industry Summit held in Lagos, where Dr. Doris Uzoka-Anite, Minister of Industry, Trade and Investment, emphasized that the automotive sector holds the key to revitalizing Nigeria’s economy and positioning the nation as a hub for automotive manufacturing in Africa.
Joseph Osanipin, Director General of the National Automotive Design and Development Council (NADDC), highlighted the pressure on Nigeria's foreign exchange market and job creation due to the reliance on imported vehicles. He noted a significant increase in the import value of passenger cars in 2023, reaching N1.47 trillion, a 224.67 percent rise from 2022, according to the National Bureau of Statistics.
Wale Adeniyi, Comptroller-General of the Nigeria Customs Service (NCS), pointed out that the influx of used cars further weakens the Naira and strains local manufacturers. He highlighted that the dominance of affordable used vehicles dampens the demand for locally assembled and new cars, hindering the growth of the domestic automotive industry.
The summit, themed "Developing Nigeria's Economy through the Auto Industry," was organized by the Nigeria Auto Journalists Association (NAJA) in collaboration with NADDC.
Former Director of NADDC, Luqmam Mamudu, and industry stakeholders such as Remi Adams from Honda Automobile Western Africa Ltd and Abiona Babarinde from Coscharis Group, stressed the necessity for government intervention in the auto finance scheme to sustain the industry.
Mamudu advocated for a N100 billion intervention fund to provide affordable vehicle acquisition loans. He suggested initially directing these loans to commercial vehicle fleet operators to enhance shared car services, buses, and trucks availability, while others proposed making the scheme accessible to all prospective new vehicle buyers.
Mamudu further recommended identifying credible private credit companies with proven records in Nigeria to manage the revolving loan scheme, supervised by the Securities and Exchange Commission (SEC).
Stakeholders also called for effective management of used vehicle imports through tariff regulations to ensure the continuous development of Nigeria's automotive industry.
Addressing industry revival, Benedeth Ejindu, a board member of the Nigeria Automobile Manufacturers Association, emphasized the urgency of passing the National Automotive Industry Development Plan (NAIDP) bill into law. This, he argued, would boost investor confidence and inject vitality into the sector, especially as the Federal Executive Council (FEC) approved NAIDP in May 2023. The plan aims to create one million jobs and enforce local vehicle procurement by government and its contractors.