Nigeria’s automotive industry holds significant potential to contribute to the country’s economic development, the Nigeria Auto Manufacturers Association (NAMA) has said.
In his presentation at the maiden edition of the Nigeria Auto Industry Summit (NAISU), held in Lagos recently, Council member of NAMA, Ben Ejindu harped on the critical roles of the automotive industry to Nigeria’s economy.
The summit was organised by the Nigeria Auto Journalists Association (NAJA) in conjunction with the National Automotive Design and Development Council (NADDC).
Ejindu explained that with strategic focus on employment generation, GDP contribution, economic linkages, SME support, skills development, technology innovation, and industrialization, the sector is poised to drive Nigeria’s economic progress.
Noting that the auto industry is a critical driver of employment in Nigeria, he said by establishing and expanding CKD (Completely Knocked Down) and SKD (Semi Knocked Down) assembly plants, the sector can generate substantial job opportunities.
He added that the availability of a large and trainable workforce further supports this potential, creating a robust foundation for economic growth.
Ejindu stated that the auto industry contributes significantly to Nigeria’s GDP through manufacturing and assembly activities.
According to him, the current statistics of $210 million and 0.04% to the country’s GDP provided by the Nigeria Auto Manufacturers Association illustrates the sector’s economic impact with a huge potential to grow.
He said strategic investments in the industry can enhance its GDP contribution, fostering economic stability and growth.
He emphasised that the auto industry creates numerous opportunities for SMEs growth through the production of automotive components and parts.
“Reviving local manufacturing of tyres, batteries, glass, and other components can stimulate SME growth, leading to job creation and economic diversification”, said Ejindu.
He explained that investment in skills development and technology innovation is essential for the auto industry’s growth. He said: “Training programs and partnerships with educational institutions can equip the workforce with the necessary skills to thrive in a competitive market.
“Embracing technological advancements will enhance production efficiency and product quality.
“The auto industry plays a vital role in Nigeria’s industrialization efforts. Attracting foreign direct investment (FDI) from key auto brands such as Hyundai, Geely, and Yutong can bolster the sector’s development. “These investments bring advanced technologies and best practices, driving industrial growth and economic progress.
“Nigeria is endowed with abundant raw materials essential for automotive manufacturing. “Leveraging these resources can reduce reliance on imports, conserving foreign exchange and promoting local production. “Developing a comprehensive automotive raw materials development and component manufacturing masterplan is crucial for maximizing these benefits,” he said.
He also noted that Nigeria’s strategic position allows the auto industry to tap into regional export potentials within West Africa and the AfCFTA. “With a potential market size of 1,150,000 vehicles per annum, the industry can cater to domestic demand while exploring export opportunities, boosting economic growth,” he stated.
He stressed that to unlock the full potential of Nigeria’s auto industry, several policy interventions and strategic initiatives are necessary, including Implementing the Nigeria Automotive Industry Development Plan (NAIDP), adding that fine-tuning it will provide a regulatory framework to support the industry’s growth; establishing a masterplan for automotive raw materials development and component manufacturing will guide the sector’s strategic growth; aggressively incentivizing CKD assembly through contract manufacturing can leverage economies of scale and attract investments, and reviving tyre, battery, and glass manufacturing as a precursor to revamping local production of various automotive components, fostering SME growth.
The Nigeria Auto Manufacturers Association outlines the immense potential of Nigeria’s auto industry to drive economic growth and development.
By focusing on employment generation, GDP contribution, economic linkages, SME support, skills development, technology innovation, industrialization, and strategic interventions, the sector can significantly impact Nigeria’s economy. Harnessing abundant resource endowments, attracting FDI, and tapping into export potentials will further strengthen the industry’s role in promoting sustainable economic growth.
According to NAMA, with the right policies and strategic initiatives, Nigeria’s auto industry is poised to become a cornerstone of the nation’s economic development.
