The automotive industry of Nigeria dates back to 1970’s when the number of international automotive manufacturing companies collaborated with the federal government of the country to establish six assembly units.
Now, almost after four decades the industry still finds itself at nascent stage attributed to varied challenges that have inhibited the industry growth. In reality, Semi-Knocked-Down (SKD) is only functional assembly line in Nigeria that is being operated domestically. The assembly line is managed by three companies namely INNOSON, Peugeot Automobile Nigeria (PAN) and Volkswagen of Nigeria (VON).
The current government has realized the urgent need to expand the Nigerian auto industry in order to create job opportunities for the locals. In addition, revitalizing the industry will greatly boost the nation’s foreign exchange revenue, skill development, and technology acquisition. Hence, developing the auto industry in the nation is a part of a long-term projected of strengthening the industrial architecture in the nation, which falls under the Nigeria Industrial Revolution Plan (NIRP) launched in 2014.
The National Automotive Industry Development Plan (NAIDP) also launched in 2014 has been designed to attract Direct Foreign Investment (DFI) in Nigeria. Under this, the government plans to revive the exhausted plants and invite new players to invest in these plants. It is further expected to technologically transform the production plants with latest systems leading to a cost-effective production process. Further, the strategy is also aimed at curbing the countries dependency on imports and make in the long run make Nigeria a hub of automotive manufacturing in Africa.
The automotive industry in various countries of the world plays a pivotal role in shaping the nation’s economy. Thus, despite great global economic depression during 2008 the global automotive industry successfully maintained stability. The industry is responsible for a major share of industrial jobs across the world. Hence, making it more important to the growth of the economy for any county or in that case a region.
Summary: The government of Nigeria looks keen on reviving the nation’s automotive industry.