By Lucy Ogalue, News Agency of Nigeria (NAN)
The global automotive industry is undergoing its most profound transformation in a century, pivoting from petrol-powered engines to electric vehicles (EVs), compressed natural gas (CNG), and other cleaner mobility systems. For Nigeria, this global shift presents not just an environmental imperative but a critical economic ultimatum: adapt and build a modern industrial base or risk permanent relegation in the continental and global auto market.
For decades, Nigeria’s auto sector has been a story of unfulfilled potential, hampered by policy inconsistency, an overwhelming reliance on imported vehicles—both new and used—weak local content development, and a debilitating skills gap. Once a leading assembly hub in Africa, hosting iconic plants like Peugeot Automobile Nigeria (PAN) in Kaduna and Volkswagen of Nigeria in Lagos, the sector’s momentum was eroded by a flood of used imports and inconsistent regulatory enforcement.
Today, the National Automotive Design and Development Council (NADDC) is spearheading a comprehensive reform agenda. We examine the core pillars of this blueprint, its potential impact, and the formidable challenges that remain.
The Cornerstone: The End-of-Life Vehicle (ELV) Policy
At the heart of the reform drive is the proposed End-of-Life Vehicle (ELV) policy. NADDC Director-General, Mr. Joseph Osanipin, confirms the policy has received necessary approvals and is poised for implementation.
Deeper Context: In developed nations, an ELV policy creates a circular economy for vehicles. At the point of purchase or registration, a fee is often included to fund the future environmentally sound disposal of the car. Nigeria’s absence of such a system has led to a landscape littered with abandoned vehicles, posing environmental hazards (from leaking fluids and batteries) and safety risks.
Osanipin explains that the policy will establish an organized recycling framework. “More than 85 per cent of components in end-of-life vehicles are recyclable,” he notes. This isn’t just about waste management; it’s about creating a new industrial segment. Recovered metals, plastics, and functional components can feed into secondary markets for spare parts, reducing the import bill and fostering local entrepreneurship. While economic value is a benefit, Osanipin stresses that environmental protection and public health are the primary drivers.
Curbing the Tide: Regulating Used Vehicle Imports
A second, critical reform targets the used vehicle market, which dominates Nigeria’s roads. From 2026, Nigeria will begin enforcing pre-export testing of used vehicles in their country of origin.
Practical Example: This means a used car shipped from the United States or Japan destined for Nigeria must first pass a standardized inspection to verify its roadworthiness, emissions standards, and that it is not, in fact, an end-of-life vehicle being dumped. The responsibility for ensuring this compliance shifts to the importer, protecting the often-uninformed final buyer. This move aligns Nigeria with practices in other African nations like Kenya and Rwanda, aiming to prevent the country from becoming the global graveyard for unusable cars.
Building Human Capital: Skills and Certification
Policy alone cannot revive an industry. Recognizing this, NADDC has made capacity building a core pillar. “We are very concerned about certification. When our people are trained, what do they have to show for it?” Osanipin states.
The council has developed National Occupational Standards for emerging fields like CNG conversion and EV maintenance—skills crucial for the future. Plans are underway to roll out structured certification by 2026. Furthermore, 21 Automotive Training Centres are being established across the six geopolitical zones to equip technicians with modern, standardized skills, creating a pipeline of qualified labor for the envisioned industrial growth.
The Legal Framework: Seeking Investor Confidence
A recurring theme in Nigeria’s industrial challenges has been policy volatility. The NADDC is pushing to convert the National Automotive Industry Development Plan (NAIDP) into an Act of Parliament. “Investment in auto is huge. We need more than policy; we need an Act that investors can hold on to,” Osanipin argues. A legislated framework would provide the long-term regulatory certainty and investor protection needed to attract the significant capital required for assembly plants and, crucially, local component manufacturing.
Industry and Stakeholder Perspectives
Recent government directives are generating cautious optimism. The “Nigeria First” initiative, mandating Ministries, Departments, and Agencies to prioritize locally made goods, is seen as a direct boost. [[PEAI_MEDIA_X]] Innocent Chukwuma, Chairman of Innoson Vehicle Manufacturing (IVM), highlights the foreign exchange conservation benefits of such patronage.
Support is also growing for the proposed Local Automobile Industry Patronage Bill. Mr. Bawo Omagbitse, Chairman of the Nigeria Automotive Manufacturers Association (NAMA), believes it could “mark a turning point” by guaranteeing sustained government demand.
However, stakeholders uniformly stress that policies must be matched with enabling conditions. Economic expert Mr. Chukwuma Obi identifies component manufacturing as “the engine room of the automotive industry.” He points out that Nigeria spends more on importing auto parts than finished vehicles, and high local production costs—driven by forex scarcity and energy—undermine competitiveness.
Auto dealer Mr. Garba Yakubu calls for stronger private-sector partnerships, while expert Mr. Simon Agbese emphasizes that without reliable infrastructure (stable power, good roads) and consistent policy implementation, growth will remain stunted.
The Road Ahead
The Minister of State for Industry, Sen. John Enoh, has pledged to fast-track legislation. Nigeria’s auto reforms are a multi-faceted attempt to navigate the global green transition and position the country within the African Continental Free Trade Area (AfCFTA).
The blueprint is comprehensive, addressing environmental regulation, market structure, skills development, and investor law. The coming years will test Nigeria’s ability to execute consistently across these fronts. Success could unlock jobs, technological innovation, and genuine industrial diversification. Failure would mean another missed opportunity in a sector ripe with potential. The journey from blueprint to a rebuilt industry is now underway.
****If used, please credit the writer and the News Agency of Nigeria.
