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Nigeria’s New Auto Policy Drops import By 20% by iterator25: 8:45am On Oct 20, 2014 |
The implementation of the nation’s new auto policy may have started yielding fruit, as importation of new vehicles into Nigeria dropped by 20 percent in the first six months of this year (2014) according to some auto makers. The development, it was gathered, was on account of the raising of import duties on new vehicles from 20 percent to 35 percent. Business Day gathered for instance, that with Nigeria as an auto market of 50,000 new vehicles a year, the implementation of the policy has reduced importation of new cars by 5,000 units. Analysts said yesterday, that the country stands to gain from the conservation of foreign exchange if government implements the policy with transparency. According to them, the expectation of Nigerians is that the figure should drop to the lowest minimum and if possible, we should rely completely on locally made automobiles. While the new automotive policy which came into effect in 2013 seeks to encourage interested foreign car makers to set up assembly plants in Nigeria, the federal government, through the National Automotive Council is also encouraging local auto component makers with loans that would fast track the development of feeder materials to boost local assembly. Meanwhile, there are indications that Toyota Motor Corporation of Japan is exploring the possibility of producing vehicles in Nigeria. Although details are still sketchy as at the time of filing this report, it would be recalled that last month, Johan van Zyl, president and chief executive of Toyota South Africa Motors, stated that the move had been prompted by the imposition by Nigeria of higher tariffs on imports of new vehicles into the country. Van Zyl said Nigeria was not a big market for new cars at this stage but it was a big country with a huge population and a big economy in Africa, which meant Toyota could not ignore it. “From a Toyota point of view, we evaluate every opportunity and every country on its own merits, in terms of whether it’s viable to produce there or not.” He said. On the time frame of possible vehicle production in the country, the company chief executive said the decision on whether the automaker would invest in another country like Nigeria is not a Toyota South Africa decision, but a decision by the parent company Toyota Motor Corporation, Japan. On the possibility of local auto manufacture in the country affecting South Africa as the export hub to sub-Saharan African countries, Van Zyl said he did not believe the government’s support for Nigeria would undermine South Africa’s vehicle manufacturing industry and the objectives of the Automotive Production and Development Programme (AODP) of the country. If the Nigerian government decided it wanted to establish a motor industry, it would do so with or without South Africa’s support, he said. He also did not believe the supply of semi-knocked-down (SKD) vehicle kits to Nigeria would undermine its own product, stressing the option was to either lose the volume completely, or supply the kits. He said that if the kits were produced in South Africa, it was still value that was created and there was also value created in Nigeria from the assembly point of view, so overall intra-Africa trade can be promoted on that basis. Ian Nicholls, vice-president of operations at General Motors South Africa (GMSA), also confirmed that the new regulations and much higher vehicle import duties in Nigeria meant foreign carmaker companies must consider to do some level of assembly locally to compete effectively and GM would have to rethink its plans in that country. businessdayonline.com/2014/10/nigerias-new-auto-policy-drops-import-by-20/ |
Re: Nigeria’s New Auto Policy Drops import By 20% by iterator25: 8:49am On Oct 20, 2014 |
in the absence of a solid car manufacturing sector and a poor power infrastructure, we made an half a trillion dollar economy. Looking forward to how things will turn up in ten years from now. 1 Like |
Re: Nigeria’s New Auto Policy Drops import By 20% by FrankC3: 9:04am On Oct 20, 2014 |
I like this policy. We seem to be getting it right in terms of long term strategic plans to develop and secure local jobs. I need to know how a Buhari government will handle this policy. Will a 'President Buhari' discard this policy, nurture it or change it? I will appreciate mature feedback from Buhari campaign team. 1 Like |
Re: Nigeria’s New Auto Policy Drops import By 20% by PaulJohn1: 10:44am On Oct 20, 2014 |
One of the few reasonable policies the country has made in 5 years. Leading to the increase in Vehicle assembling plants in the country. Table of vehicle assembling plants in Nigeria.
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Re: Nigeria’s New Auto Policy Drops import By 20% by anonimi: 11:02am On Oct 20, 2014 |
PaulJohn1: The policy is very good no doubt. However the relevant officers in government should be careful in reporting progress and impact to avoid giving figures that may be construed as non-factual if not supported by concrete, verifiable data. 1 Like |
Re: Nigeria’s New Auto Policy Drops import By 20% by Reptyle(m): 11:10am On Oct 20, 2014 |
anonimi: Exactly!!! The hurry to milk every marginal development for political gain has always been the bane of laudable policies. It is a good policy and I hope it is not allowed to die a natural death after the elections are won and lost in 2015. 3 Likes |
Re: Nigeria’s New Auto Policy Drops import By 20% by egift(m): 11:38am On Oct 20, 2014 |
Because tarrif was increased and not that the local manufacturers are now satisfying local demand. 1 Like |
Re: Nigeria’s New Auto Policy Drops import By 20% by PaulJohn1: 11:47am On Oct 20, 2014 |
anonimi: That said, it'll even be more reasonable that government encourages these assembling firms to manufacture and not just assembly in the country, this would mean a lot to the economy. Meanwhile, there are indications that Toyota Motor Corporation of Japan is exploring the possibility of producing vehicles in Nigeria.^^ I pray it happens. Finally, the implemetation of high tarrifs on imported goods should be effected on other goods and materials, with encouragement for indigenous manufacturers to prevent dominance of foreign investors like it is in SA. 1 Like |
Re: Nigeria’s New Auto Policy Drops import By 20% by Ikengawo: 11:56am On Oct 20, 2014 |
iterator25:half a trillion 2 Likes |
Re: Nigeria’s New Auto Policy Drops import By 20% by FrankC3: 12:02pm On Oct 20, 2014 |
egift: Either way, it is still a sound policy. Imagine what would be the case today if this 'import tariff increment' was implemented in 1984, by now, Nigeria, not South Africa would be the vehicle assembly hub of Africa. |
Re: Nigeria’s New Auto Policy Drops import By 20% by Nobody: 12:06pm On Oct 20, 2014 |
My own worry is, i hope we won't be fighting for another PIB in the auti industry. INNOSON |
Re: Nigeria’s New Auto Policy Drops import By 20% by Nobody: 12:08pm On Oct 20, 2014 |
FrankC3:Wrong if interest rates and inflation had stayed as it was in 1984, today we will be above china. |
Re: Nigeria’s New Auto Policy Drops import By 20% by Nobody: 12:09pm On Oct 20, 2014 |
How does this auto policy protect/encourage indigenous manufacturer. Thats all i care about. |
Re: Nigeria’s New Auto Policy Drops import By 20% by Ikengawo: 12:11pm On Oct 20, 2014 |
It makes buying new local cars cheaper than new foreign ones. |
Re: Nigeria’s New Auto Policy Drops import By 20% by wanimo: 12:13pm On Oct 20, 2014 |
This is a loudable policy. We should encourage such policies and help the Nigerian path to industrialization. |
Re: Nigeria’s New Auto Policy Drops import By 20% by Nobody: 12:13pm On Oct 20, 2014 |
If you bring foreign car parts here to assemble at almost zero import duty, i don't see how that benefits Nigeria and nigerians. Hiw does foreign part become local cars? |
Re: Nigeria’s New Auto Policy Drops import By 20% by Nobody: 12:17pm On Oct 20, 2014 |
wanimo:Well i hope so but there to many questions unanswered. Looks like quick fix to me |
Re: Nigeria’s New Auto Policy Drops import By 20% by Ikengawo: 12:23pm On Oct 20, 2014 |
Obiagelli: Easy, because nigerians are paid to "assemble" the parts and our money stays in the country. Innoson manufactures though, and all car brands import and assemble a portion of their parts. They will also buy components from Nigerian business men like metals, leather, cloth, etc. The presence of one plant also attracts another business which attracts another. 2 Likes |
Re: Nigeria’s New Auto Policy Drops import By 20% by phantom(m): 12:28pm On Oct 20, 2014 |
assembling here will create more jobs for our people. but the full impact of this policy will never be felt as long as poor power supply is an issue we are still grappling with. |
Re: Nigeria’s New Auto Policy Drops import By 20% by Nobody: 12:32pm On Oct 20, 2014 |
egift:Nbody said anything about local needs been met by the local manufacturers, it's still a long way off but the increase in tariff discourages importation of foreign cars which would boost local production. That means more money for the local manufacturers, jobs for Nigerians and the conservation of the very scarce foreign exchange. The gains are quite large dont you think? 1 Like |
Re: Nigeria’s New Auto Policy Drops import By 20% by Nobody: 12:33pm On Oct 20, 2014 |
Ikengawo: I would like to see that happen though. My worry here is where is the protection for innoson and innoson to be. Mtn's money does not stay here. |
Re: Nigeria’s New Auto Policy Drops import By 20% by phantom(m): 12:33pm On Oct 20, 2014 |
another problem we have is the inability of our government to see policies through and through. why isn't this same FG and its ministries using made in Nigeria official cars? the same thing with the state govts. why should an individual go for innoson when he's government doesn't ? |
Re: Nigeria’s New Auto Policy Drops import By 20% by Nobody: 12:36pm On Oct 20, 2014 |
phantom:Indigenous manufacturer will suffer because it costs more to produce here, else everyone will just start importing parts. |
Re: Nigeria’s New Auto Policy Drops import By 20% by atlwireles: 12:42pm On Oct 20, 2014 |
anonimi: |
Re: Nigeria’s New Auto Policy Drops import By 20% by Nobody: 12:42pm On Oct 20, 2014 |
Vote GEJ if you want the good work to continue. |
Re: Nigeria’s New Auto Policy Drops import By 20% by naptu2: 12:52pm On Oct 20, 2014 |
Obiagelli: It's a progressive thing. We had a similar policy in the 1970s and 80s (unfortunately, successive governments did not follow through on it). Basically, what you do is:- 1) Encourage car companies to set up plants here. Some will assemble CKD no doubt, but 2) With time, discourage CKD. This was one of the advantages that PAN had over VON. VON usually assembled Completely Knocked Down kits (CKD), while PAN had many indigenous manufacturers that manufactured and supplied them with parts (spark plugs, tyres, mirrors, etc) to the extent that PAN could claim (by the late 1980s) that it made Peugeot 504 cars that were ninety-something percent made in Nigeria. This was why VON suffered more from the implementation of SAP than PAN did. 3) The nigerians that will work in these plants will earn an income and get expertise and income that could enable them to set up on their own in future. 2 Likes |
Re: Nigeria’s New Auto Policy Drops import By 20% by PointB: 12:58pm On Oct 20, 2014 |
FrankC3: That's the importance of well thought out policy and setting up proper structure. If this policy and others like are given more time, Nigeria will be better off for it. The current administration have learnt some wonderful lessons and seems to have gotten a handle on many challenging issues. Staying course with team fresh air is task that must be done, no time for Sharia economic policy experimentation! 1 Like |
Re: Nigeria’s New Auto Policy Drops import By 20% by Nobody: 1:04pm On Oct 20, 2014 |
naptu2: Thanks for your insights naptu2, but my question is how does this policy ensure we aint going the VON way? These policy gives almost zero import duty to assembly plants/companies (except i am wrong), how will this encourage them to buy locally? How do we ensure technology transfer? Is not enough to say they will employ nigerians, many Nigerians have lost their jobs to these policy already. There are many unanswered questions. |
Re: Nigeria’s New Auto Policy Drops import By 20% by Ngwakwe: 1:12pm On Oct 20, 2014 |
Obiagelli: You are wrong and I doubt you actually comprehended every component of this policy. Re-study the policy before critiquing 2 Likes |
Re: Nigeria’s New Auto Policy Drops import By 20% by atlwireles: 1:14pm On Oct 20, 2014 |
naptu2: Why not name the government responsible for the major setback. Yes, tell people Buhari was responsible, with his import license /currency restriction policies. That was the beginning of our manufacturing malaise. 18 months of his closed border and one man show, caused so much damaged it took almost 30 years to fix 3 Likes |
Re: Nigeria’s New Auto Policy Drops import By 20% by asha80(m): 1:14pm On Oct 20, 2014 |
Obiagelli:as for your last paragraph no matter how good a policy you want to bring into nigeria or any society people must lose jobs...it all depends on whether the policy would create more jobs(and quality ones) compared to the lost jobs. |
Re: Nigeria’s New Auto Policy Drops import By 20% by Nobody: 1:18pm On Oct 20, 2014 |
Ngwakwe:I would expect that you point out my error. |
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