National Automotive Industry Development Plan (NAIDP): Nigeria's Quest and Setbacks in becoming a Vehicle Manufacturing Hub

In July 2015, the automotive industry in Nigeria witnessed an epoch event. It was the reopening of the Volkswagen car assembly plant after 20 long years!


The plant located along the Badagry expressway received a new lease of life through a partnership agreement between the German car manufacturer and the Stallion group, a private auto company. According to the Chairman of the company, Sunil Vaswani, the plant had already started the assembling of trucks, buses, pick-ups, and passenger vehicles.


IVM G5 by Innoson Vehicle Manufacturing Co. Ltd.

For many observers, this was the result of the National automotive industry development plan announced in 2014. The policy aims to encourage local manufacturing of vehicles by local and foreign manufacturers and also seeks to reduce the importation of used cars into the country.


The policy, which embodies the country's hope to become Africa's auto manufacturing hub, has not been without setbacks. In September 2019, the Minister of Industry, Trade, and Investment, Adeniyi Adebayo revealed a new start of the auto policy. According to the Minister, the initial policy was not working, and the new policy would cover every necessary area needed to move the country's auto industry forward.


The auto industry, according to the Minister, employs about 5,000 direct workers and 20,000 indirect workers and is expected to grow with the new automotive bill.

Two years later,  the NAIDP act is yet to be passed. According to industry stakeholders, the inability of the government to give legal backing to the policy has seriously affected the growth of the sector as many vehicle manufacturers who originally would have set up shop in the country now move to neighbouring Ghana.


Speaking to Nigeria Motoring Press, the Executive Director, Nigeria Automotive Manufacturers Association, NAMA, Mr. Remi Olaofe, pinned the delay in passing the bill down to a lack of political will. He further lamented that the Nigerian auto policy which inspired the Ghanian auto policy, was already thriving.


Yet, for over two years, the new Nigeria auto policy is still under review.

Notwithstanding these setbacks, the auto industry recently witnessed a joyous event when the Dangote Peugeot Automobiles Nigeria Limited (DPAN), rolled out locally assembled vehicles from its new Greenfield Ultima Assembly plant located in Kaduna State. A testament to the viability of the country's auto sector.


This feat was made possible through the partnership of Stellantis Group, the parent company of Peugeot, the Kano and Kaduna state governments, and the Dangote group.

The plant, which can assemble 120 vehicles in a day across two shifts, is expected to roll out models such as Peugeot Land Trek, Peugeot 3008, 5008, and other models.


The journey to revive the moribund Peugeot Automobile began in 2016 with the Dangote Group, Kaduna State government, and the Bank of Industry (BOI) announcing their interest to buy majority shares of the company. 

In 2017, it was reported that the Dangote Group had acquired the license to establish a Peugeot plant in Nigeria.


It's still left to be seen the heights the country's auto sector can achieve as stakeholders and the general public wait for the government to set the new auto policy rolling.

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