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Experts warn: Auto industry risk collapse if…

By Theodore Opara

THE Nigeria automobile  industry may collapse finally unless Federal Government and stakeholders in the sector chart a leeway for the ailing sector. This was the submission of Dr. Oscar Odiboh, an Automotive Communication Consultant and Senior Lecturer at Covenant University, Otta, Ogun State who was the guest lecturer at the monthly industry forum of the Nigeria Auto Journalists Association in Lagos.

Odiboh lamented that four years after the introduction of the Federal Government’s automotive industry development plan (NAIDP), Nigerians are yet to feel the impact positively. He noted that economic downturn, uncertainties and government inactions have crippled the growth of the industry despite concerted effort to turn the country to a vehicle producing nation.

Odiboh, who spoke on ‘Implementation of Nigeria’s Auto Policy: The way Forward’; insisted that the industry is divided and may not thrive until the stakeholders collaborate. He observed that almost mid-term into the 10-year plan, most of the assembly plants set up in the country lack the standard to compete globally, and can hardly be called assembly plants,

“What we have at the moment are not real assembly plants, they are glorified joineries. 65 per cent of our assembly operations are manual, while 70 per cent of employees are casual,” he stated.

The National Automotive Design and Development Council (NADDC), the federal government agency saddled with the responsibility of implementing the auto policy, has repeatedly claimed that there are over 50 auto assembly plants in the country, hence alluding to the success of the policy.

Odiboh, who noted that players in the sector were frustrated through importation rules, added that more than 60 per cent of tools in the sector are manual. He regretted that rather than producing budget cars the manufactures were busy trying to roll out most advanced cars including electric vehicles.

Odiboh said the sector’s inability to offer affordable vehicles for mass market would keep used market growing to the detriment of the sector and Nigerians.

He therefore submitted that is lack of patronage threatening the survival of the sector as brand new vehicles remained unaffordable for an average middle class citizen.

Odiboh called on the federal government to provide a finance that would enable Nigerians acquire brand new vehicles, warning that projected objectives may remain elusive unless there is market for brand new cars.

He identified  poor power supply, bad roads, lack of  processed raw materials, lack of long term financial investment and others were bane of the industry.

He also noted that Corruption, deceptive data from the stakeholder, profit diversion, mutual suspicion, porous borders as well as poor positioning could eventually run down the policy, Odiboh said.

It would be recalled that a former  Chairman of the Auto and Allied sectoral group of the Lagos Chamber of Commerce and Industry (LCCI), Dr. Oseme Oigiagbe, had expressed regret that significant achievements have not been recorded up to this period.

Oigiagbe, who is also an Executive Director of Truck Masters Automobile company, expressed this  when he presented a paper at the 5th  Nigeria Transport Awards and Lecture (NTA &L), held in Lagos.

Explaining that implementation of the policy had been more of ‘motion without movement’, he said the “Vehicle finance scheme programme with consortium finance group led by Rank bank  of South Africa would have spark up the consumer demand and ease the vehicle acquisition opportunities”, but it is yet to take off.

He also blamed the slow implementation of the policy on poor infrastructure, high interest rate, as well as poor regulatory concern. Oigiagbe added that the local component manufacturers seems to be in a dilemma and not able to “to rise up to the occasion”.

Also speaking at the NAJA Forum, President of NAJA, Frank Kintum harped on the need for rejigging of the policy and exhibition of political will to move the industry forward, which he said is capable of addressing key challenges in Nigeria, particularly unemployment and industrial development. Kintum said the Monthly NAJA Forum is a platform to discuss issues affecting the automotive and road sector as they affect the country.

 


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