Stakeholders in the transportation sector have lamented the 60% drop in car importation in the past 12 months attributing it to the worsening forex crisis in the country.
With the naira trading at ₦1,418/$1 in the parallel market, amid the biting inflation at 28.92%, the car import business in Nigeria has recorded a massive hit with total imports through the Nigerian ports currently standing at 132,293 units, a significant drop from 194,550 recorded in 2022.
The local vehicle manufacturers in Nigeria have also taken the hit as the production of affordable made-in-Nigeria vehicles for the lower cadre of the country has been a nightmare.
According to the National President, the Association of Motor Dealers of Nigeria (AMDON), Ajibola Adedoyin, the 60% reduction was just a conservative estimate judging from the massive number of car dealers who have abandoned the vehicle dealership business due to the crisis in the sector.
Adedoyin noted that the development will negatively affect commuters as transport levies would be increased as vehicle owners would decide to pass on the high cost of the vehicles to commuters.
He also added that there would be a higher event of road crashes as transporters would now find it difficult to replace worn-out vehicles and instead, would be forced to operate old and faulty vehicles.
Speaking further, Adedoyin linked the crisis in the industry to the depreciation of the naira amid volatilities in the foreign exchange market.
Other causes are high duties, levies, taxes, the Vehicle Identification Number (VIN) valuation policy of the Nigeria Customs Service (NCS), rising poverty and weakened purchasing power of consumers.
Vehicle dealers, however, have noted that the vehicle costs in Europe and America have remained stable and have been reported to have reduced in some cases. They added that the major reason for the increase in the cost of vehicles in Nigeria was due to the Naira equivalent of the purchase price, the customs duty, the clearing cost as well as port charges.
