Nigeria: 'Local Vehicle Plants Achieved 3% Capacity in 6 Years'

Lagos — Former Director of Policy and Planning, National Automotive Design and Development Council (NADDC), Luqman Mamudu has said the automotive industry plan launched in 2013/2014 has barely achieved three percent success of the projected results.

Mamudu, who is the Managing Partner at Transtech Industrial Consulting disclosed this in a position paper to the Manufacturing Association of Nigeria (MAN) as a contribution for the review of Nigeria manufacturing development Blueprint 2020.

Daily Trust reports that the NAIDP Bill, which was passed in the 8th National Assembly was not assented to last year by President Muhammadu Buhari.

Mamudu recalled how in six years, the NAIDP "attracted the presence of global automotive brands assembly in Nigeria with an estimated installed capacity of about 600,000 automobiles per annum.

He said, "The six automotive plants earlier privatised by the government have mainly been revitalised. However, investment has been mainly by local entrepreneurs with OEMs interest limited to technical partnerships. Furthermore, less than 3percent capacity utilisation has been achieved."

He charged the NADDC to resubmit the National Automotive Industry Development Plan (NAIDP) Bill to the National Assembly for enactment.

This, it was noted, would facilitate the inflow of additional Foreign Direct Investment (FDI) by Global Original Equipment Manufacturers (OEMs) reluctant to invest in the country's auto sector.

He also observed that assembly operations have largely stagnated at Semi knocked Down (SKD) level with limited value addition, noting the capacity utilisation has been abysmally low "to justify additional investment in upgrade to Completely knocked Down (CKD)."

The former NADDC Acting DG restated that Nigerian market had a huge annual market demand for one million vehicles per annum, which makes it attractive to any investor.

He added: "In addition, there are 14 m vehicles on Nigeria roads to support after-market investment; urging government to launch an intervention fund for the acquisition of automobiles especially for buses and heavy duty vehicles;

"The Nigerian Customs Service should open up its 17-digit Vehicle Identification number (VIN) window to Vehicle Administration Authorities in the 36 States and FCT. This will facilitate easy verification of vehicle duty payment status at point of vehicle licensing and curtail smuggling;

"Government should provide intervention funds to build the NAIDP automotive suppliers parks under a public private partnership (PPP) model for components and parts manufacturing. This will bring about massive employment and local value addition to Nigeria automotive manufacturing processes."

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