Nigeria unveils plan to enhance car manufacturing

The Minister of Industry, Trade and Investment, Doris Uzoka-Anite, revealed Nigeria’s aspiration to become a prominent player in the vehicle manufacturing sector.

This announcement came during the launch of the Nigeria Automotive Industry Development Plan, attended by stakeholders from various sectors.

According to Uzoka-Anite, the development plan aims to transform Nigeria into a fully-fledged vehicle manufacturer within the next decade.

The plan encompasses the production of motorcycles, tricycles, sedans, and heavy-duty trucks.

Joseph Osanipin, Director-General of the National Automotive Design and Development Council, outlined proposed policies during the event.

These include a five-year tax holiday for vehicle assemblers, intended to encourage backward integration and component production.

The Automotive Industry Development Plan’s implementation committee comprises representatives from Ministries of Finance, Transport, and Environment, alongside bodies such as the Nigeria Customs Service, Manufacturers Association of Nigeria, and Standards Organisation of Nigeria.

Despite the promising future, Nigeria’s vehicle assembly sector has faced challenges in recent years. Rising production costs and diminished demand have led to a decline in activities, reflected in indices such as production and distribution costs, shipments, and capacity utilisation.

The Federal Government’s Automotive Policy of 2014 aimed to bolster local content and facilitate vehicle financing. However, the industry still faces hurdles, including government procurement practices and regulatory gaps.

Currently, Nigeria produces less than 10% of its vehicle demand, underscoring the need for concerted efforts to realise its manufacturing potential in the automotive sector.