Nigeria’s long-standing dependence on tokunbo (foreign-used) vehicles is facing its biggest disruption in over a decade. According to the National Bureau of Statistics (NBS), the total value of used car imports plummeted by 83%, dropping from ₦819.15 billion in the first half (H1) of 2023 to just ₦138.62 billion in H1 2024.
What’s more alarming? No foreign-used vehicles were recorded in Q1 2024. While there was a rebound in Q2, the year-on-year numbers still spell trouble: an 81.5% decline.
Shipping Slowdown Signals a Deepening Crisis
Data from the Ports & Terminal Multipurpose Limited (PTML) paints an even grimmer picture:
- H1 2023: ~45,000 vehicles landed
- H1 2024: ~18,000 vehicles landed
Freight-forwarding insiders reveal that where three car vessels once arrived monthly — each carrying up to 2,000 vehicles — now only one vessel docks every three months, carrying fewer than 300 cars.
What’s Fueling the Collapse?
1. Soaring Import Duties
The government in mid-2024 replaced the 1% Comprehensive Import Supervision Scheme (CISS) with a 4% Import Adjustment Tax (IAT) on vehicle value — on top of the existing 35% import duty and levies. Heavier vehicles (over 2,000cc) are hit hardest.
2. Foreign Exchange Volatility
Importers are struggling with an unstable exchange rate, pushing prices through the roof. A once affordable foreign-used car has now become a luxury.
3. Regulatory Changes
The imposition of a 4% Free on Board (FOB) levy has added further weight. Many in the import and freight sectors argue that this policy failed to consider the transportation needs of everyday Nigerians.
Voices from the Ground: Industry Reactions
Prince Adewale Ajiboye, Head of the Motor Dealers Association of Nigeria (MDAN):
“Importers can’t bring in tokunbo anymore. Some dealers have dropped out of business altogether.”
Mr. Pius Ujubonu, former Interim President of ANLCA:
“It’s becoming a luxury to own a car. The policy affects everyone — no exemptions for commercial vehicles.”
Mr. Stanley Ezenga, NAGAFF:
“We need to give this policy 3 more months to assess the real impact. Importation won’t stop, but inflation is inevitable.”
What’s Happening to Car Prices?
Foreign-Used Cars:
- Toyota Corolla (2015 model): From ₦1.9 million → ₦9.5 million
- Honda CR-V & Lexus RX: ₦16 million to ₦25 million
Locally-Used Cars:
With foreign imports drying up, demand for Nigerian-used vehicles is rising — driving up prices and reducing availability.
A Lagos-based dealer, Chidi Okoye, explains:
“We used to go to Cotonou. Now buyers are coming to us because importation has become too expensive.”
Safety and Reliability Risks Emerging
Industry experts warn that the increased recycling of older, worn-out cars could lead to:
- Higher accident rates
- More vehicle breakdowns
- Reduced roadworthiness overall
The Way Forward: Local Assembly as a Lifeline
The Motor Dealers Association is advocating for bold steps to revive local production.
Key Demands:
- Government incentives for local assembly plants
- Tax breaks for made-in-Nigeria vehicles
- Public-private partnerships to create jobs and reduce import reliance
According to Funmi Ogundele, MDAN President:
“Promoting locally-assembled vehicles would create jobs, stabilize prices, and reduce our overreliance on costly imports.”
Final Thoughts: Is Mobility Becoming a Luxury in Nigeria?
As policies tighten and forex woes persist, owning a vehicle is fast becoming a luxury for many Nigerians. Without a shift in approach — particularly toward supporting local vehicle production — the country risks deepening its transport inequality.
The question now is: Can Nigeria drive itself out of this crisis? Or will mobility remain out of reach for the average citizen?
Join the Conversation
Have you been affected by rising car prices? Are you considering buying locally-used or exploring alternatives?
