A cross section of Innoson IVM 6800 buses still going through assembling process at Innoson assembly plant in Nnewi
The Lagos Chamber of Commerce and Industry (LCCI) have explained that for Nigeria to have a good automobile market, the sector should be able to produce at least 100,000 new vehicles every year.
The Director-General of LCCI, Muda Yusuf, who gave this explanation in a chat with Shipping Position Daily in Lagos, last week also maintained that today the automobile industry cannot boast of 15, 000 new vehicles annually in terms of market size as against the 100,000 which they are supposed to be producing annually.
Yusuf reiterated that the nation is not yet ready for the production of affordable vehicles, adding that the sector lacks the basic things needed to compete in the industry.
He however said that the capacity in the industry cannot support the setting up of automobile industry, even as he called for the review of the automobile policy and reduction on duties payable on imported vehicles.
He argued that: “What we are expecting is that the automobile policy should be reviewed and the duties reduced, because the policy is not achieving its objectives. But for some of us who are the stakeholders we need to see that we do a very strong advocacy so that the government will review the policy”
“The issue is that we are not ready for the production of affordable vehicles yet in this country, we don’t have what it takes, we don’t have the industry that will support the automobile industry like the iron and steel industry. We don’t have the infrastructure to support the manufacturing of vehicles, we don’t have the funding to support those who want to do this business and we don’t also have the market”.
“For you to have a market for this business you will be talking about 100,000 brand new vehicles every year, what is the market today? Today we are talking about less than 15,000 brand new vehicles in terms of market size, how can that support the setting up of a big automobile industry or business?”, he stated further.
The LCCI DG maintained that for the past five years now with the automobile policy has only led to loss of revenue both on the side of the government through the Nigerian Ports Authority and the concessionaires.
Arguing further, he said: “We have been on that policy now for over five years what has it achieved, we have over 50 assembly plants, how many vehicles are we producing. And on top of that, Customs is losing revenue, smugglers are taking over the place, our maritime workers have no business to do because all the vehicles have been diverted to Togo and Cotonou, so what are we gaining?”
“NPA too is losing revenue, the concessionaire at the RORO port is also losing business and money and vehicles have become too expensive; where people cannot afford to buy vehicles. So the policy is stopping a lot of people and revenue”, he maintained.
The LCCI boss advised that the nation should start with the manufacturing of automobile spare parts that can support both the used vehicles and other vehicles on the road.
“So we should start gradually, we should start developing the production of spare parts that can support both the used vehicles and all other vehicles on the road. We don’t have a tyre manufacturing company here in Nigeria, Dunlop and Michelin have parked up, what are we doing to bring them back. Let’s start with the production of parts first before we talk about producing brand new vehicles”, he advised.