…Over 50 Plants Shut Down in 9 Years…Only 6 Currently Active
By Frank Kintum
The number of auto assembling plants in Nigeria are rapidly decreasing due to a number of avoidable factors which a player in the space and auto expert has described as disturbing.
Kunle Jaiyesimi, Deputy Managing Director of CFAO Motors, recounted these factors recently at the 2022 Nigeria Auto Journalists Association (NAJA) capacity building programme held in Ikeja, Lagos.
According to the auto boss, who doubles as the Chairman of the Auto group of the Lagos Chamber of Commerce and Industry, the current operating environment in the auto sector, makes it more profitable to import Fully Built Up vehicles than engage in local Complete Knock Down (CKD) or Semi-Knock Down (SKD) assembling.
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He stated that some of the factors militating against the growth of the industry include refusal of “Presidential assent to the NAIDP Bill since the commencement of the Auto Policy or assembly scheme of the Federal Government since 2014.
“Lack of incentives to those that invested billions in the automobile assembly project; and non-availability of vehicle finance scheme despite the collection of over N180 billion levies on Fully Built vehicles by the Nigeria Customs Service on behalf of the NADDC (National Automotive Design and Development Council)/FG (Federal Government).
Other factors identified include -frequent upgrade of imported vehicles (SKD/ CKD) values by the Nigeria Customs Service; and delay in vehicles/containers clearing process as a result of bottlenecks at the ports due to activities of various government agencies at the ports”.
Jaiyesimi also listed non provision of forex by the CBN (Central Bank of Nigeria) for settlement of our L/Cs and reduction of duty payable for non-assemblers and used vehicle importers as other contributory factors.
