Two days ago, we reported here on Naijauto that China has commenced the exportation of used cars to Nigeria. Well, it appears the news didn't go down well with the automotive sector in the country. Car manufacturers, dealers across the country and stakeholders are angry and have taken to various platform-online and offline, to express their anger over the new development. A move which they say is China's way of scaling up its income from vehicles.
At the moment, the new development hasn't been confirmed by any government personnel under the auto sector and importation of the vehicle. Information reaching us says that out of the 40,000 used cars that were imported via the Nigerian ports from June-July, 25% of the cars were made-in-China.
Notwithstanding, the local car manufacturers and dealers are being blunt in their rejection of the arrangement on the ground that it would ruin the local automotive industry. They said it was irrational for Nigeria to comply with China's move to ship in its used cars when a lot of automakers are facing the challenge of American and European auto brands which has invaded the auto market. An attempt which they say is to turn Nigeria into a dumping ground.
While expressing his view over the matter, Mr. Abiona Babarinde, the General Manager in charge of the Marketing and Corporate Communications at Coscharis Group said,
"If this position is correct, it will be counterproductive and unfortunate. Used cars from China or any country should not be encouraged by our government now. It will not be value-adding.
Nigeria will be a dumping ground for all manner of vehicles. This can’t grow the local auto industry; it will be a setback for the local assemblers of vehicles.
Besides, it will be confusing for government to encourage importation of used vehicles from China at the time same it is encouraging local production of vehicles."
Local automakers voiced out that China's move will turn Nigeria into a dumping ground for used cars
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Joining to voice out his own stance is Dana Motors Marketing Manager, Mr. Olawale Jimoh who told newsmen that the shipping of China-made tokunbo vehicles into Nigeria will stunt the little progress which has been evident since 2014, brought about by the introduction of an auto policy and also incapacitate the economy followed by the massive loss of jobs.
"What we will be basically doing is to help the Chinese economy grow. By bringing in their used cars, production of new cars will grow in their own country. This will help them generate more employment and increase their Gross Domestic Product.
It will also make our country a junkyard of used cars in the world; we are currently contending with used cars from European
countries, America and all of that."
The local automakers weren't left behind as they also spoke their mind. Representing them is Mr. Remi Olaofe, the Executive Director of Nigeria Automotive Manufacturers Association, who opined that the Federal Government hasn't expressed ample commitment towards the 5-year-old auto policy.
Will Chinese imports create healthy competition and make cars more affordable for Nigerians, or kill the local dealerships?
He bemoaned the foot-dragging on getting President Buhari to consent to the Nigeria auto-bill.
He added that,
"No investor will want to come to a country where their business is not protected."
Senator Shehu Sanni on his Twitter handle said that,
"To ban the importation of textiles and milk to ‘protect our local industries’ and allow the importation of used vehicles from China is a dumb economic policy."
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The DG, Lagos Chamber of Commerce and Industry, Mr. Muda Yusuf pointed out that used vehicles weren't enlisted under the import prohibition list. He gave a word of advice to the Federal Government, to state the age limit and types of vehicles acceptable into the country.
"There are too many junks coming into the country and this poses safety risks. The government needs to redefine the age limit of cars coming into the country.
Also, the import duty on used cars should be reduced to a maximum of 20 per cent so that people can afford newer models of used cars instead of going for junks. The market for rickety vehicles has become very huge because of affordability challenge caused by high import duty
We have no steel and iron industry to support the policy. We do not have a tyre or battery producing firm.
What people do is that they just bring in parts and assemble them here, making the vehicles more expensive than they are supposed to be. We don’t have competitive advantage in automobile manufacturing and it is better for us to concentrate on areas in which we have competitive strength such as oil and gas sector."
Talking about the auto policy, Mr. Yusuf chirped that the auto policy needs to be evaluated and argued that Nigeria isn't well developed to handle such a policy.
It's on record that China's Ministry of Commerce had revealed its intention to commence the exportation of used vehicles to 10 auto markets across the globe of which Nigeria is among. This was to increase the sales in the automotive industry which declined for the first time last year, since the 1990s.
According to the reports, the first batch comprising of 300 used vehicles, will hit the shores of Nigeria soon.
However, the Nigeria Customs Service and National Automotive Design and Development Council stated that the new development hasn't been communicated to them.
A Customs official stated that,
For now, the plan by the Chinese is non-existent to us because it is yet to become an action. We have not been informed officially.
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