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Home Opinion Kick Starter with Femi Owoeye Yawning Void in Nigeria Auto Sector

Yawning Void in Nigeria Auto Sector

 

By: FEMI OWOEYE

More and more automobile assembly plants are springing up. Almost like a pure water business. You can count two, three, four, now and more are acquiring acres of land. Many others are warming up to storm Nigeria like a tempest.

Toyota plant takes off latest August. Coscharis has acquired massive sparse of land around Lekki, Lagos to start building luxury cars. Nissan has taken off.

I recently visited Kia assembly plant along Oshodi-Apapa Expressway. Nigerian-assembled Kia brand is already rolling into nation’s auto market. Of course, Peugeot has been on ground. And they are determined not to be outplayed in the automotive premier league coming up.

But, like my headline screams, a window of opportunity still remains opened. You say for what?  Established assembly plants need to increase local content within certain period. It’s part of the provisions in the automobile policy. To meet requirements, which have to be met within the next nine years, locally manufactured auto parts for their brands would be God-sent.

From the foregoing so far, a smart business magnate would have seen a window of investment opportunity widely opened. No need doing any marketing survey. It is obvious that, right now, there is a very ready market for automobile parts manufacturing.

The more content the assemblers can source locally, the less their cost of production will be. And as such, prices of vehicles in Nigeria will come down. When that happens, there will be no need for imported used vehicles, which I gathered, total close to 300,000 units per annum as at the end of May as against annual sale of only about 50,000 units of brand new cars. When more local contents are added and cost of car production falls, prices of brand new vehicles would fall.

No one would spend two million Naira to buy an imported used car, which can be acquired directly from a Nigeria without stress of visiting ports for clearing.

And Nigeria, being an auto-loving nation and a society, where cars are status symbol, more Nigerians then would see need to own cars. Then, local automobile production will surge up to millions, could be 10 or 20 millions, being a nation of almost 200 million people.  So imagine being a fuel filter or oil filter manufacturer in Nigeria, when these things happen. It means you could secure guaranteed annual order of millions of your product annually to a ready market.

Essence of this write-up is not to paint an imaginary picture. It is to alert able auto parts manufacturer to rush into Nigeria now and take advantage of investment opportunity, when it’s still hot and smoky. This is not a game of chance. It is an industry that is ready to explode. The likes of Dana and Stallion are smart. They can see the immediate future. They are on ground already, waiting for the wind of prosperity that is about to blow across the nation. Toyota and Coscharis are planning big. Peugeot Nigeria is massive. The Chinese Auto maker, GAC is putting things together for made-in-Nigeria GAC cars. All of them will be glad to keep their foreign currency and simply gather their required auto making parts in Nigeria. Who says there can’t be car designers in the country? There is opportunity for a Nigeria’s Pininfarina. If you are that good, trust me, you’ve struck a goldmine.

Nigerian gang of auto assemblers will be glad to also source their engines locally. Oh dear! What about glass parts? There are windscreens, side and inner mirrors, so many plastic parts, auto upholstery, car seats, the bulbs, and more, even in-car entertainment devices? If Philips is no more at Ojota, Lagos, this is time to return. Monaplex Industries used to make Dorian Filters at Ojota those days. Have they relocated to Ghana like Dunlop? It’s in your interest to rush back. Soonest.

Investors in the US, GB, Italy, France, Germany, South Africa, India, China, Canada, Nigeria, wherever you are around the globe, Nigeria auto industry is as viable now as the nation’s tourism and agriculture sectors.  Do your SWOT Analysis, you’d realise that opportunities in this sectors now far more outweigh threat, if there is any. If you have the fund and technology know-how, you’ve got strength.

Time to act is now before the yawning void gets filled up.

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