‘Nigeria to become Africa’s next automotive hub by 2050’
If Nigeria remains committed to the implementation of its automotive policy, it may realise its potential of being the hub of the continent’s automotive industry, accounting for 70 per cent of new cars to be manufactured by 2050, latest PwC report has shown.
Similarly, the report projected that Imported used vehicles, popularly referred to as Tokunbo cars will become non-existent as a direct result of local production as well as sustained investment and implementation of policies in the automobile industry.
Specifically, the report showed a projection of increased output in other manufacturing sectors and key auxiliary industries such as solid minerals and rubber industry to boost confidence of OEM brands to begin actual manufacturing, adding that manufacturing is projected to begin in 2023 and by 2030, would account for 33 per cent of new vehicle sales.
The report added that as CKD production and eventually manufacturing begins, the customers’ preference for foreign used imports will gradually reduce.
“Losing their competitive advantage of being more affordable, customers will gradually shift their preference to locally assembled cars and internally generated used cars. Foreign used cars’ 70 per cent market share will steadily drop to 35 per cent by 2028 and die out by 2034”, the report showed.
In its latest automotive industry report titled, “Africa’s next automotive hub”, it noted that Nigeria has the potential to become the hub of Africa’s automotive industry, considering the fact that it remains home to an estimated 170 million people, with over 40 million in the growing middle class, as well as an economy that is increasingly seen as an attractive destination for investors across all sectors.
Partner, PricewaterhouseCoopers Limited, Andrew S Nevin, while presenting the report yesterday, said the projected growth requires sustained and effective investment in the automobile industry made only possible by the government implementing political, economic and legal policies that create a suitable environment for such investment.
“Given the intent shown by the Nigerian government, PwC developed growth projections for the Nigerian automotive industry. The growth projections highlight the potential of the industry and present three different scenarios for the industry till 2050.
“In these scenarios, growth is measured in term of car sales and we have assumed it to be dependent on GDP. As a result, we use PwC’s The World in 2050, a report that forecasts economic growth for 32 of the largest economies in the world, for the period 2014 – 50.”
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