N’Assembly, NADDC pledge support for local vehicle manufacturers

The National Assembly and the National Automotive Design and Development Council have pledged legislative and policy support for local car manufacturers during an oversight visit by the House Committee on Industry to various vehicle assembly plants and facilities in Lagos.

The House Committee, led by its Chairman, Dolapo Badru, acknowledged the unique challenges facing local manufacturers, including high interest rates and soaring foreign exchange.

Badru emphasised the importance of affordable financing options for car buyers, citing high funding costs as a major hurdle for the sector.

“They [assembly plants] complained of funding,” Badru noted. “The cost of funding is very high and they need to survive. We advised them that they rely more on government patronage, but they should also strive to attract the ordinary Nigerian.”

He further urged car manufacturers to introduce schemes that would enable Nigerians to purchase vehicles through instalment plans, similar to arrangements in other countries.

“In other climes, people do not put cash down to buy a house or car. You pay in bits, so they should inculcate that kind of process,” Badru said.

The lawmaker underscored that the assembly plants would receive continued support from the National Assembly in the form of enabling legislation to enhance their businesses.

He also expressed his commitment to a free market, rather than banning imports, as a way to support local manufacturers.

“To me, I would rather live in a free market,” Badru remarked. “If I’m guaranteed that when I buy your car, I’m going to use it in the next 10-15 years, why would I go and buy the one that’s imported?”

The NADDC Director-General, Joseph Osanipin, presented the challenges of local manufacturers and assemblers of vehicles in Nigeria and their accomplishments to the house committee, urging extended assistance.

Osanipin lauded the joint visit, describing it as a “handshake” between the executive and legislative arms to resolve issues faced by the industry.

“We need to have more of these handshakes to understand ourselves and bridge the challenges in the auto industry,” Osanipin stated.

He emphasised that manufacturing parts domestically was essential for job creation and economic growth.

“If we want to create more employment, we have to start producing more of those components,” the NADDC DG said, noting that companies like Mikano are already taking on this challenge.

The first day of the oversight visit concluded with a tour of key automotive plants, including CIG Motors and Dangote Sinotruck West Africa Limited, both of which Osanipin hailed as having made strides in local assembly and environmental efficiency.

The committee expressed a commitment to working with industry players to enhance Nigeria’s automotive capabilities and reduce reliance on imports.

Meanwhile, at a briefing with the Committee, the Executive Director of CIG Motors, makers of GAC Motors, Jubril Arogundade highlighted the company’s efforts to make locally assembled GAC vehicles accessible to Nigerians.

Arogundade called for federal policies that would help local manufacturers compete in pricing.

“Our advocacy is not around a ban on foreign imported cars,” Arogundade stated. “The federal government needs to support the local manufacturers assembling in Nigeria by creating policies that will make them have more incentives.”

Arogundade noted that CIG Motors has developed affordable financing options, including a pay-in-instalments scheme, to ease the cost burden on Nigerians.

“We created the drive-down pay data scheme three years ago,” he explained. “You drive your car today and pay small, small. And we partner with 12 banks in Nigeria.”

However, the businessman noted high interest rates have been a challenge.

“Today, the interest rate is 35 per cent to 33 per cent. If we had a program with 80 per cent funding, I can argue that it would take me one month to sell my entire stock,” he added.