Data obtained from the National Bureau of Statistics (NBS) shows that Nigeria spent a whooping sum of N1.08 trillion to import used cars (popularly called Tokunbo) and motorcycles (Okada) in one year (October 2018 – September 2019).
According to the various NBS reports gathered, used cars and motorcycle importation into Nigeria rose from N252.3 billion in Q4 2018 to N301.8 billion in Q3 2019.
Breakdown: Car and motorbike importation in Nigeria
Nigeria remains a large import-dependent country, as the nation’s import bill between October 2018 and September 2019 rose to N15.19 trillion while the country’s export for the same period stood at N18.87 trillion. This implies that the country’s trade balance summed up to be N3.68 trillion.
- Analysis of the data shows that the importation of used cars gulped N676.3 billion during the period while the amount spent on motorbike importation stood at N411.3 billion.
- This means with Nigeria’s import amounting to N15.19 trillion, used cars and motorcycle importation accounted for 7% of the country’s total import.
- According to the report, most motorbikes imported into the country are completely Knocked Down (CKD). Basically, CKD is fully disassembled item parts that are required to be assembled by the end-user or the reseller. Goods are shipped in CKD form to reduce freight charge on the basis of the space occupied by volume of the item.
- On the other hand, used cars imported are either with diesel or semi diesel engine, of cylinder capacity.
- Further details provided by the Bureau show that the used imported cars came from countries like the United States, Italy, Belgium, Germany and Canada.
- However, motorcycles (CKD) imported into Nigeria are basically from India and China.
Why the rising trend?
In recent years, ride and motorcycle-hailing platforms are one of the two fastest-growing businesses in Nigeria.
- As technology keeps evolving, so is the ride-hailing industry. Today, spread all over major commercial cities across the country are Uber, Bolt, OgaTaxi, GidiCab and many others, all competing in the ride-hailing industry. On the other hand, the bike-hailing platforms are equally worth the mention, with GoKada, Opay, Max.NG and so on.
- Hence, as the ride-hailing industry continues to expand, investors spend trillions of naira to import most of the items.
- It is noteworthy to state that the industry expansion is indeed a welcome development as this creates thousands of jobs for Nigeria’s teeming population.
- However, one would wonder why Nigeria’s automobile industry still remains at a standstill despite the huge growth potential it presents to the country.
Automobile industry in Nigeria still at low ebb
Despite the upward reviews of tariffs and duties imposed on the importation of cars and motorcycles by the Federal Government since 2014, the rigmarole continues as car importation figures keep increasing.
- Also, the figure provided by the bureau, to say the least, omitted smuggled cars while brand new cars are reported separately.
- Recently, Nigeria Customs Services shut 272 car marts during a raid on car marts suspected to be harbouring smuggled vehicles. The raid was conducted across the country in Lagos, FCT, Kaduna, Kano, Sokoto and Kebbi.
- In a bid to attract foreign investors to set up cars plant in Nigeria, President Muhammed Buhari recent attempted to lure Toyota car manufacturer into the country. However, Toyota Group made known its intention to invest in several sectors in Nigeria apart from automobiles.
- Nigeria’s automobile industry remains in a tatters and there is no end in sight for now. In a recent development, the Nigerian 9th National Assembly defended its plan to import Sports Utility Vehicles (SUV) amounting to N5.5 billion.
Source:: Nairametrics
