The ‘new’ automotive policy

There is actually nothing ‘new’ about the policy. The nation had an automotive industrial policy which was being implemented by the National Automotive Council. Some vehicle assembly plants were established and strategically spread across the country under that policy for cars and light trucks. There was Leyland in Ibadan; Steyr in Bauchi; ANAMMCO in Enugu; Volkswagen in Lagos, and Peugeot in Kaduna.
Those plants fell on bad times and all but two of them- Peugeot and ANAMMCO- went under due to bad management, unfavourable economic climate as a result of the introduction of the Structural Adjustment Programme in the mid-1980s, high cost of the products that citizens could not afford, among other factors. However, that the government has woken up to the reality that a viable local automotive industry is in the interest of the country and the West Africa sub-region is a welcome development.
 The transport sector is an essential wheel on which any modern economy moves.
Nigeria is a repository of antiquated rail system; its inland waterways are poorly developed and notoriously unsafe. The highly capital intensive aviation sector is virtually evolving.
With respect to the automotive sector, the economic cost of importing cars, trucks, tractors and buses for commuter, agricultural and construction uses cannot be sustained over a long period.
Aganga’s policy placing emphasis on domestic production of automobiles is on the surface good; but not good enough when it is considered under it, foreign automakers would still play a commanding role. In the 1960s, 1970s and 1980s when foreign manufacturers were invited to begin assembly of automobiles from imported completely knocked down (CKD) parts, the goal was at some point, local content would have such a level as to produce a completely Nigerian made car. It never materialised. A policy that would follow the same trajectory would now be inexcusable and unacceptable.
The argument that the operation of foreign companies will lead to a transfer of technological skills is not as persuasive now as it was decades ago. The country now has a large pool of trained, skilled and experienced artisans and technicians, at home and in the diaspora, who can be deployed to operate a successful automotive industry, with the right environment and appropriate incentives.
The reported readiness of some multinational automakers to set up assembly plants in Nigeria should not impress policy planners. Dr Aganga should not be taken by such promises, as he appeared to be when he announced the policy. What is essential in moving the policy to a beneficial start would not be the token foreign direct investment that may come into the Nigerian economy or the minimal skills transferable to a few Nigerian or the largely lower level cadre jobs that could be created. It would be national self-reliance, which will guarantee many more jobs; a technology that is Nigerian, better suited to conditions and needs of the country and people.
 There is nothing against beginning an entirely new automotive industry from scratch, like India did in the 1960s and today, that country has vibrant auto industry that contributes much to the country’s Gross Domestic Products.


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