Auto Assembling: Stakeholders Urge Govt Patronage

Peugeot 301
Peugeot 301

Stakeholders in the automotive industry have urged the government to ensure it supports local auto assemblers by way of patronising their products and services.
Speaking on different occasions, the stakeholders reasoned that since government is a major purchaser of brand new vehicles, a deliberate policy to direct its orders from local auto assemblers would go a long way in ensuring the success of the new auto policy.
It would be recalled that when the National Auto Industry Development Plan (NAIDP) was introduced in 2013, some auto companies were forced to set up plants, with PAN Kaduna re-investing in its plant. VON, Lagos and Innoson in Nnewi were the other two prominent names that made headlines. PAN started the production of 301 and 508 sedan and luxury sedan respectively, while Innoson produces IVM 6490, an SUV and IVM 500 bus among others.

Chairman, Automobile and Allied Sectoral Group of the Lagos Chamber of Commerce and Industries, LCCI, Dr. Oseme Oigiagbe, noted that though low patronage was a factor adversely affecting the local auto industry, the foreign exchange crunch is also a major issue.
He called on government to encourage local auto assemblers through the 2016 budget by way of ensuring that they are given priority in patronage against importers of Fully Built Up FBU vehicles.
Oseme noted that the “budget as it is today does not have policy measures to discourage importation of used cars”, which is a major step towards making a success of the revised auto policy.
Auto industry analyst, Dr. Oscar Odiboh, bemoaned the sorry state of the auto industry, even as he noted that Innoson Motors is only one of the many auto companies that are down-sizing staff.

He said: “The reality on ground is affecting everybody. I know of a company that has sacked half of its work force, some others are busy converting staff from full time employment to contract staff, even when it is against the labour law to do so. When government says companies should not down size, how do you want them to pay their staff when you don’t buy vehicles from them?” he asked.

Also speaking, Chairman of the Guild of Motoring Correspondents, GMC, a pressure group in the local auto sector, Mr. Frank Kintum reasoned that the auto industry plays very important roles in the economy of any country.
According to him, the Federal Government should at all times pay premium attention on issues affecting the industry as “a healthy auto industry serves a as catalyst for the growth of all other sectors, aside its contribution to the GDP.”

Kintum said: “Don’t forget that in Nigeria, we rely heavily on road transportation for both passenger and cargo movements. Hence, it is only reasonably that the government takes more seriously the implementation of the auto policy so that the country benefits in terms of value added while making use of this means of transportation. We commend the National Assembly for its promise to patronise Innoson vehicles, but it should also consider other local auto assemblers”.

The importance of the auto industry cannot be over-emphasised, as it is a major employer of labour, significant contributor to GDP, as well as a chief facilitator of technology transfer among others.
According to the International Organisation of Motor Vehicle Manufacturers (IOCA), the auto industry is the greatest engine of economic growth, just as the industry is a key sector of the economy of all major powers in the world.




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