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Author Name: Omotayo, J. A.
Number of articles: 211
During my time too, there were scholaships, grants and busary awards to students. Some of my friends... (0) Comment


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That Nigeria’s Automotive Policy Does Not Become A Nightmare – 1
Author: Omotayo, J. A. | February 14, 2014



I have read with interest Nigeria's dream of producing and exporting vehicles beginning in April 2014 (See: âIn the next few years, Nigeria will begin to export cars to other countries â President Goodluck Jonathanâ, Jan. 21, 2014, www.ngex.com; and âNissan Motors to roll out first made in Nigeria SUV in April 2014â, Jan. 24, 2014, www.ngex.com). I have also read government policy designed to make the vehicle production and export dream come true (See: âDuties and levies on new and used vehicles and tyres imported into Nigeria to increase in 2014â, Nov. 25, 2013, www.ngex.com). A few Nigerians at home and abroad commented on the issue on www.ngex.com. There were not enough time and room for all my views to be spelt out in my comments, hence this article. The difference between a dream and a nightmare is that the former fascinates while the later scares. We all may be fascinated by government pronouncements on the one hand and be scared by criticisms (by affected used vehicles and tyres importers and opposition political parties views) on the other hand. I do not believe that any of these two extremes should sway us to miss our direction and lose our mentality. I am neither an importer nor a political party member to criticise a good endeavour for pecuniary and political reasons. I disagree with the policy of government in this situation because there are various issues that have been ignored, misplaced and or misunderstood. I like to briefly review government and opposing positions before elaborating on the issues prompting me to write. Government position, known as the âNational Automotive Industry Policy', has in its plan the imposition of high duties and levies on imported vehicles and tyres. This would rise from about 20% in the past to about 37% each. In other words, the total additional cost on imported vehicles and tyres may attract over 74% if VAT and other taxes are added. This is aimed at deterring importation whilst encouraging local production of vehicles and tyres. The added value of the policy, as government understands it, is the generation of employment opportunities for Nigerians. Viewed from this perspective, no one can query the good intension of government here. Importers of used vehicles and tyres whose businesses will be affected may from now raise their prices to the discomfort and detriment of millions of Nigerians. Many Nigerians are already used to celebrating the purchase of second hand vehicles and equipment and many more are eager to join the league of vehicle owners. Some others have been managing with imported second hand tyres. These groups would feel threatened by increase in import duties and levies. Our porous borders with our neighbours would cause increase in smuggling with attendant increase in risk of patrolling and high incidence of corruption. Opposition political parties may hamper on these flaws and seize the opportunity to realign with the importers and many average Nigerians itching to become vehicle owners to gain sympathy and advantage in subsequent elections. Is the policy initiative right or wrong? This is what this article attempts to answer. But before delving into further details, we need to recollect from history some basic information of the automobile industry in the recent past in Nigeria. There was a time when Nigeria had six motor vehicle assembly plants (out of which three were prominent) where vehicles were rolled out all over the country. There were in addition various motorcycle assembly plants meeting the need of the middle class. These were in the 1970s to last the decade. The three prominent motor vehicle assembly plants included Peugeot Automobile Company of Nigeria (PAN), Volkswagen Company of Nigeria (VON) and Anambra Motor Manufacturing Company of Nigeria (ANAMCO). I grew up to know of PAN in Kaduna where all government salon car series were assembled, rolled out and sold or purchased. There was a government policy to patronise PAN for all official cars. It was a national policy during Mr. Obasanjo's rule as a military head of State (1976 â 1979). At Ondo State (later split into Ondo and Ekiti States) Water Corporation where I started my career in 1987, the official vehicle for all senior officers was Peugeot. It was the same in all other agencies of government then. The trend continued for decades by all levels of government. Various models and series were even purchased and distributed to officers of the Nigeria Police, Armed Forces, paramilitary agencies â Customs and Immigration by the Obasanjo civilian regime (1999 â 2007). Peugeot models were not only elegant they were rugged. There were many models to choose from: 203, 302, 403, 404, 504, 505, 605, 606, 607, etc. The Peugeot 504 and 505 station wagons were the most versatile commercial cars used for long distance journeys in Nigeria. They could run Lagos â Sokoto, Lagos â Kano, etc and return without stopping except to load, unload, fuel and allow passengers to feed or attend to call of nature. Some of those purchased over ten years ago are still on the road transporting commuters from one distant location to another in Nigeria. Peugeot salon and station wagon models were loved by owners, drivers and mechanics. They could be serviced and repaired anywhere, anytime and any day. There was the J-5 mini-bus model called the âlandjetâ by commuters travelling from one distant location to another. It was so fast that journeys that would take other vehicles 10 hours would be made in about eight hours. This made it a popular choice for almost all Nigerian youths (students, youth corpers, boys and girls). There were later the super executive and expensive models, the 600 series, designed for the rich, top civil servants and high profile political office holders. In order words, the Peugeot models were able to meet the needs of every class of people in the society. Why is PAN no longer producing in Nigeria as it was the situation decades earlier even with government and private patronages? Peugeot headquarters in France has not closed down production yet PAN has in Nigeria. What went wrong? There was the VON in Lagos. Volkswagen Beetle was a very popular brand among the middle class of Nigerian workers in the 1970s and 1980s. All level 7 officers in the nursing, teaching, administration and technical positions in the public service and traders cherished the Beetle car. It was cheap to purchase, economical to run and maintain, and rugged on the road. It could pass through flood without the engine going off. I still remember the slogan âDon't kill the Beetleâ of the 1970s and 1980s. The slogan was intended to warn owners not to overload the car due to its ruggedness and perceived strength. Millions of Beetle cars were sold and they kept moving on Nigerian roads then. There was the associated Combi Bus (mini-bus) popular with commercial motor vehicle operators, drivers and commuters. They were the cheap commercial vehicles of choice for workers and traders within towns. Millions were sold and used in Nigeria. Some are still on the road now. Both Beetle and Combi Bus were renowned for their fuel efficiency. They had other attributes too. They were air cooled and could be serviced and repaired by most mechanics. There were the faster moving and more elegant variants common with the average and above average Nigerians then. These were the Passat, Gallant, Jetta and Audi models. In spite of all the patronages, VON stopped car assembly long ago. What killed VON? Volkswagen headquarters in Germany is till waxing stronger and owns a vehicle âcityâ, a mighty skyscraper where new models are displaced for inspection and purchase. There was the celebrated ANAMCO in Enugu from old Anambra State (later split into Anambra and Enugu States) where Mercedes Benz vehicles were produced in the 1980s and 1990s. The military government of both Messrs Buhari and Babangida attempted to claim credit for the coming into production of ANAMCO's Mercedes Benz vehicles. Nigerians cherish the Mercedes Benz because they are rugged, elegant and used as barometers for the identification of the above average. Why? They are expensive and consume more quantities of fuel. But the Mercedes Benz models have one advantage - They never summersault even at high speeds. The various car models include the V-boot, Mercedes 180, 200, 230, 250, 300 and 330 series. There are still the more elegant and expensive models for the rich and high profile political office holders - the E-class and four wheel drive. For long distant transportation, there are the mini-buses and luxury buses. Most transporters use the luxury buses to move commuters and goods over long distances whilst using the mini-buses for executive tours and travels. In view of this demand trend, we need to ask a few questions. How many ANAMCO vehicles are on the road today compared to imported Mercedes Benz by private importers? Very little! What has led to this unwanted development? Other less prominent motor vehicle assembly plants include Leyland Assembly Plant in Ibadan from old Oyo State (now split into Oyo and Osun States). The place has been abandoned. What killed it? Others include Styre Assembly Plant in Bauchi, Bauchi State and Fait Assembly Plants in Kano, Kano State. What killed them? What about the motorcycle assembly plants, are they thriving instead of the motor vehicle assembly plants? No! What killed them?

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