Stakeholders divided over proposed import ban on used vehicles

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The country’s automotive landscape is primarily shaped by imported vehicles. The proposal to ban the importation of used cars that are over 20 years old has drawn mixed reactions, Justice Okamgba writes

The National Automotive Design and Development Council has proposed a ban on the importation of used vehicles that are more than 20 years old. This move is intended to prevent the country from being a dumping ground for old cars and to encourage the growth of the local automobile industry.

The Director-General of NADDC, Joseph Osanipin, said the council planned to collaborate with relevant authorities to enforce age limits on used cars and specify minimum standards for imported vehicles.

He said, “We are going to start what we call deletion policy, which is contained in the NAIDP being reviewed today because that is the only way we can grow our local content.

“That is the only way we can develop our parts. We are working to identify the parts we can produce in Nigeria.”

“We are looking at the production of tires, plastic, foams, leather, and even batteries.”

“The sooner we identify these and component manufacturers that can do this according to our standard, the better for us.”

He further said that producing those local components would enable the council and relevant agencies to delete the importation of all items produced locally in the country.

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Nigerians depend heavily on imports for their automobile needs, despite several attempts to revamp the comatose local industry.

Data from the International Trade Administration of the United States showed that Nigeria’s annual vehicle demand was 720,000 units, while local factories could only produce a fraction, 14,000 units annually, resulting in a substantial shortfall that necessitates imports to meet consumer needs.

According to the National Bureau of Statistics, in the first nine months of 2023, the country imported used vehicles valued at N926.09bn from the United States and the United Arab Emirates.

The first quarter witnessed used car imports worth N59.53bn, a figure that surged to N721.79bn in the second quarter, only to experience a dip to N144.77bn in the third quarter.

The call to ban the import of used vehicles is not new. The immediate past Controller-General of the Nigeria Customs Service, Hameed Ali, had proposed a ban on vehicles above seven years when he appeared before the lawmakers for a budget defence session in 2021.

He stated, “We are now working on a policy proposal that will reduce the years of the vehicles that will be imported into the country as used vehicles.

 “Our goal is to ensure that we have roadworthy vehicles, and that is not to say that we want to kill our home-grown industries.

“We hope that our industries will begin to produce vehicles that we can afford to buy and reduce the importation of used vehicles.”

Industry experts argued that such a measure could be the catalyst needed to stimulate local production.

However, others contend that the industry’s vitality relied heavily on the influx of imported vehicles, including damaged ones, which serve as a crucial source of spare parts.

Battery and Power Systems Analyst at DM Lustrous Cars Ltd, Victor Ezeali, told SKYBLASTTV that it was not a good development to see many vehicles after serving their 10-year lifespan in their originating countries, finding their way to Nigeria.

Ezeali lamented that many of the vehicles imported into the country do not meet many safety standards after being in use for over a decade.

“When you bring in some of these vehicles, you will realise that some of the components do not function well, like the airbags and the rest.

I have mentioned that Nigeria just needs to get its steel industry working because that is the foundation for us. We need to start manufacturing certain things here before we can properly boost local production of vehicles,” he said.

The National Automotive Industry Development Plan (NAIDP 2023-2033) was established to reduce dependence on vehicle imports and promote local production. However, the plan is yet to get the legal backing it requires to make it a law.

Experts said used car exports from Western countries exacerbated air pollution in underdeveloped regions and obstructed attempts to reduce the effects of climate change in developed markets.

The United Nations Environment Programme noted that between 1990 and 2013, almost 250,000 deaths in Africa were caused by car pollution from imported vehicles.

The Managing Partner at FMC Advocates, Fidel Mwaki, stated, “Implementing the import ban may help reduce the effect of old imports on the environment within the country as we look to transition to lower emissions or cut out fossil fuel dependency altogether to reduce these hazardous emissions.”

The Chairman of Automedics Motor International, Yusuf Adah, said banning the importation of vehicles from 2007 and below would be a misplaced priority for the industry as those vehicles represent an affordable option for the average Nigerian.

Adah explained to SKYBLASTTV that the industry’s practice involves importing mainly accident vehicles, utilising the salvaged parts to service and maintain the current vehicle population within the country.

The engineer said, “If they eventually place a ban on the importation of these vehicles, the price of car parts will skyrocket and we may not even have them to buy. For example, most of the sensors we use in Nigeria are from those damaged vehicles we import.”

Adah drew attention to the overarching issues with the regulatory framework, highlighting the dependency on imported products, including brake pads, side mirrors, and rubbers, which are often sourced from China.

Adah noted that many of the issues still lay with the regulators, adding that aside from petroleum products, engine oil, and a few other vehicular fluids that were produced in Nigeria, other things were largely imported.

He said, “The government must look for other ways to stimulate the industry. We largely depend on importation. If you categorise the shipments that are coming into this country, more than 50 per cent are vehicle parts.”

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