GIVEN the right operating environment, the local vehicle manufacturing and assembly plants have capacity to satisfy the nations needs by producing 150,000 units of vehicles worth N550bn annually, the Director-General, National Automotive Council, Mr. Aminu Jalal, has said.He also said the industry was capable of generating 70,000 skilled jobs and 210,000 indirect employment opportunities.Jalal, who spoke through the Director of Policy and Planning, NAC, Mr. Lukman Mamudu, at a symposium in Lagos on the revitalisation of the automobile industry in Nigeria, however, lamented that the total current operating capacity for local assembly plants by value is N30bn.The nation, according to him, spends N400bn on the importation of 200,000 used vehicles and 80,000 new vehicles annually.The NAC DG, who was guest speaker at the event, organised by the Automobile and Allied Products Sector of the Transport Group, Lagos Chamber of Commerce and Industry, however, noted that the local auto assembly and manufacturing plants could produce more vehicles than the number needed.To urgently arrest the situation, Jalal called for an upward review of the import duty for Semi-knocked Down and Fully Built Units (vehicles) to discourage importation of second-hand vehicles and make local production and assembly plants to flourish.It is, therefore, recommended that the import duty on automobile FUB and SKD should be revised to 35 per cent and 20 per cent respectively from the current 10 per cent to 20 per cent, he said.He said low import duty on vehicles was also holding back many firms from establishing assembly plants in Nigeria, just as existing ones were finding it hard to break even.For instance, the NAC boss lamented that seven auto manufacturers that indicated interest in establishing assembly plants in Nigeria between 2010 and now had put the plans on hold.He added that they all complained that the import duty on vehicles was too low.He gave the names of the companies as Alliance Autos (importers of Renault and Nissan vehicles), Anhull Motors of China, Chagan Motors of China, Iran Khodro Motors, Zhonda Motors of China, Zhengzhou Yotong Group Company of China and Geely Motors of China. He explained that Japan, South Africa, Brazil and other auto producing nations used high import duties to protect their fledging indigenous manufacturers or force global car firms to invest in the development of national motor industries.Jalal also stressed the need for the government to provide an intervention fund to revitalise the auto industry.He specifically proposed a N150bn intervention fund for the industry to realise its full potential.He said, The automotive industry is capital intensive with relatively low return on investment, requiring long term and low interest loans, while on the other hand, it has high socio-economic rate of return in terms of job creation, technology acquisition, wealth creation and as a catalyst for industrialisation.Jalal also hinted of plans by NAC to assist people to buy new vehicles as one of the measures to improve the business of local manufacturers of automobiles.He said the council had initiated a trust fund of N20bn for the purpose.The President, LCCI, Chief Olufemi Deru, underscored the importance of the automotive industry to the national economy and noted that over 90 per cent of movement of people and haulage of goods in Nigeria was done through road transportation.
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