Moses Akaigwe

The refusal of President Muhammadu Buhari to assent to the Nigeria Automotive Industry Development Plan {NAIDP} Fiscal Incentive and Guarantees Bill may have flushed about N2.5trillion worth of local and off-shore investments in the sector, down the drain.

This was the submission of an automotive consultant, Dr. Oscar Odion Odiboh, who at a forum in Lagos, lamented the failure of the country’s auto policy to work as enunciated five years ago, and recommended a shift towards encouraging auto assembly plants to evolve and grow.

He also canvassed “patriotic patronage” of locally assembled vehicles among Nigerians as a means of ensuring high capacity utilisation for the auto plants.

“Let the industry move on. Revolution is not by force. It starts with evolution. We must evolve to revolve. Let our auto industry evolve, then it can revolve”, he told guests at the 2019 Nigeria Auto Journalists Association (NAJA) workshop.

Odiboh, who is a Senior Mass Communication lecturer at the Covenant University, Ota, Ogun state, advised the National Automotive Design and Development {NADDC} to restrict itself to design, development of infrastructures and campaigns on patriotic patronage of made in Nigeria vehicles.

Speaking on the topic Zero Patronage, Zero Tariff and the Redefinition of Patriotism by Nigeria’s Automobile Industry, he noted that the inability of President Buhari to assent to the bill has proven anti-policy agitators right, in addition to casting a question mark on Nigerians’ patriotism.

The auto industry consultant said, “Even stakeholders are not comfortable with the policy and there have been too much ado in doing nothing. Nothing is working”

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The Federal Government, he argued, should direct the Nigeria Customs Service (NCS) to “increase tariff on used imported vehicles from 30 percent to 80 percent; reduce tariff  on brand new imported vehicles from 70 percent to 30 percent; {and} introduce zero percent tariff on locally CKD assembled vehicles.”

Odiboh said that the implications of the 2019 budget which may not ensure Nigerians buy new cars, is that the operating auto assembly plants will witness further drop in sales which stood at 58 percent in 2018.

“Another implication of the budget to the assembly plants is that, it will add to the 23,000 job losses of the past five years”, Odiboh said.

Revealing the reality observed in 40 sampled auto assembly plants in Nigeria, he said, “Five years cumulative installed capacity is 450,000 vehicles, but we have five years cumulative output of 15,000 vehicles”.

“Average cumulative annual capacity is 90,000 vehicles, but we have an average cumulative annual output of 375 vehicles. Average annual capacity per assembly plant is 2,330 vehicles, but we have average annual output per assembly plant of 10 units”, he said.

Odiboh, therefore, lamented that it is really difficult to determine how many assembly plants that Nigeria has, as “many are licensed; few are working; some are fatally wounded and others are dead on arrival”.

First announced on Wednesday, October 2, 2013, as one of the resolutions of that day’s Federal Executive Council (FEC) meeting, the NAIDP came into full effect on Tuesday, July 1, 2014. One of the targets of the policy was to stimulate investments in local production of affordable vehicles as against importation of fully built units which leads to a lot of foreign exchange going abroad.