‘Why government’s vehicle financing scheme is not achievable

Segun Ajayi-Kadir

In efforts to enable Nigerians buy new cars, the Federal Government in 2013, launched a new financing scheme through its National Automotive Industry Development Plan (NAIDP).The plan, which is expected to discourage the importation of vehicles into the country, and encourage local manufacturing of vehicles, is yet to gain momentum, as Nigerians still find it difficult to buy a brand new car assembled locally.
  
The plan provides for a credit purchase scheme, to ensure that funds are available cheaply, and made available as loans to civil servants, haulage and passenger commercial companies, and the general public that patronise made in Nigeria vehicles.For government’s financing scheme to become a reality, the Chairman, Boulos Enterprises Limited, Robert Ugbaja, said there must be sufficient purchasing power in the economy to enable middle class Nigerians afford new cars.

Ugbaja argued that placing a ban on imported used vehicles, and imposition of punitive tariff cannot be lifeline needed by local automobile manufacturers.He said the National Automotive Design and Development Council (NADDC) have so far registered over 50 companies to assemble and ultimately manufacture their brand of vehicles in Nigeria, and noted that less than 50,000 units of new cars were imported into the country in 2017.
To build a sustainable automotive industry in Nigeria, he called for a return to the basics, which is motorcycle manufacturing, and build upwards thereafter.
According to him, most major economies with thriving auto industries also have strong and deep-rooted motorcycle manufacturing sector.“They built their automotive industries on solid motorcycle manufacturing foundation, which enabled them to start from the basics in developing assembling and manufacturing skills while taking into account local developmental conditions,” he said.