Trouble As China Ships Used Vehicles To Nigeria

Automakers, dealers and other stakeholders have expressed anger over China’s resolve to push its used vehicles to Nigeria and other global markets as a strategy to shore up its income from automobile.

 

Although no government official connected with the auto industry and vehicle import was willing to confirm the development, The PUNCH gathered on Tuesday that not less than 25 per cent of about 40,000 used vehicles imported through the Nigerian ports in the last two months were China-made.

 

But local automakers and dealers are unequivocal in rejecting the arrangement, which they insist will kill the local auto industry.

 

They said it was absurd for Nigeria to allow China to ship its used vehicles to the country at a time many automakers were still battling with the influx of used European and American auto brands.

 

They called it an attempt to make Nigeria a dumping ground for used vehicles with short lifespan.

 

The General Manager, Marketing and Corporate Communications at the Coscharis Group, Mr Abiona Babarinde, said, “If this position is correct, it will be counterproductive and unfortunate. Used cars from China or any country should not be encouraged by our government now. It will not be value-adding.

“Nigeria will be a dumping ground for all manner of vehicles. This can’t grow the local auto industry; it will be a setback for the local assemblers of vehicles.

“Besides, it will be confusing for government to encourage importation of used vehicles from China at the time same it is encouraging local production of vehicles.”

 

The Marketing Manager of Dana Motors, Mr Olawale Jimoh, told The PUNCH that allowing used Chinese models into the country would not only retard the little progress made in the last five years with the establishment of an auto policy but would also cripple the nation’s economy with massive job losses.

 

He said, “What we will be basically doing is to help Chinese economy grow. By bringing in their used cars, production of new cars will grow in their own country. This will help them generate more employment and increase their Gross Domestic Product.

“It will also make our country a junkyard of used cars in the world; we are currently contending with used cars from European countries, America and all of that.”

 

The Executive Director, Nigeria Automotive Manufacturers Association, Mr Remi Olaofe, said the Federal Government had not shown enough commitment to ensuring the success of the five-year-old auto policy.

 

He lamented the delay in getting President Muhammadu Buhari to assent to the Nigeria auto bill, adding, “No investor will want to come to a country where their business is not protected.”

 

Senator Shehu Sanni, in a tweet on the issue, stated, “To ban the importation of textiles and milk to ‘protect our local industries’ and allow the importation of used vehicles from China is a dumb economic policy.”

 

The Director General, Lagos Chamber of Commerce and Industry, Mr Muda Yusuf, noted that used cars were not under import prohibition list. He advised the Federal Government to redefine the age limit and types of cars that could be brought into the country. He said, “There are too many junks coming into the country and this poses safety risks. The government needs to redefine the age limit of cars coming into the country.

 

“Also, the import duty on used cars should be reduced to a maximum of 20 per cent so that people can afford newer models of used cars instead of going for junks. The market for rickety vehicles has become very huge because of affordability challenge caused by high import duty.”

 

On the impact of the importation of Chinese cars on the national automotive policy, Yusuf remarked that the policy was due for a review and maintained that Nigeria was not ripe for such a policy.

 

He said, “We have no steel and iron industry to support the policy. We do not have a tyre or battery producing firm.

“What people do is that they just bring in parts and assemble them here, making the vehicles more expensive than they are supposed to be. We don’t have competitive advantage in automobile manufacturing and it is better for us to concentrate on areas in which we have competitive strength such as oil and gas sector.”

 

China’s Ministry of Commerce had reportedly announced in a statement that it would soon begin the exportation of used cars to 10 global markets including Nigeria with a view to driving its vehicle sales, which contracted last year for the first time since the 1990s.

 

The report specifically indicated that the first batch of 300 used cars would be in the country soon.

 

But sources at the National Automotive Design and Development Council and the Nigeria Customs Service said the matter had yet to be communicated to them.

 

Investigations by The PUNCH in Abuja also revealed that none of the two agencies of government had received any official communication on the modalities through which the vehicles would be brought into Nigeria by the Chinese government.

 

A top Customs official said, “For now, the plan by the Chinese is non-existent to us because it is yet to become an action. We have not been informed officially.”

 

He added that since it was a plan by the Chinese government, it was currently a diplomatic issue whose details could only be handled by the foreign affairs ministry.