By Etop Ekanem

Nigeria’s automotive sector is at a critical juncture and requires decisive government intervention to unlock its full potential, according to legal and automotive specialist, Abiola Hunsuwhegbe.

In an interview recently, Hunsuwhegbe warned that without targeted support, the industry’s contribution to national GDP will remain marginal and the country will continue to rely heavily on imported vehicles.

Speaking on the sidelines of the Lagos Automotive Summit, Hunsuwhegbe outlined three major obstacles currently straining the sector: inconsistent policy frameworks, severe infrastructure deficiencies, and limited access to finance and foreign exchange.
“The National Automotive Industry Development Plan (NAIDP) was a promising start, but its implementation has been erratic. Frequent changes in tariffs and the absence of long‑term incentives deter both local manufacturers and foreign investors,” he said.
He added that poor road networks and unreliable power supply inflate production and logistics costs, making locally assembled cars uncompetitive against cheaper used imports.

The expert also highlighted the financing gap that hampers both manufacturers and consumers.

“Banks are reluctant to extend credit for automotive projects, and the scarcity of foreign exchange blocks the import of essential components and machinery. This vicious cycle curtails production volumes and stalls job creation,” Hunsuwhegbe explained.

To reverse the trend, Hunsuwhegbe called for a coordinated policy package that includes stable tariff regimes, tax holidays for manufacturers, investment in road and power infrastructure, and the establishment of a dedicated automotive financing facility.

“If the government acts now, the sector could generate thousands of jobs, boost local manufacturing, and contribute significantly to Nigeria’s GDP,” he asserted.
The automotive industry currently accounts for roughly 3 % of Nigeria’s GDP, a figure that could rise to 8‑10 % with the right policy environment, according to industry estimates.

Stakeholders are urging the Federal Government to prioritize the sector in the upcoming National Economic Council agenda.