The situation has been blamed on challenges such as the non-availability of foreign exchange to bring in machinery from the suppliers, frequent upgrade of imported vehicle values by the Nigerian Customs Service (NCS), delay in clearing containers at various ports in Nigeria, among others.
Deputy Managing Director of CFAO Motors, Mr Kunle Jaiyesinmi, made this known while speaking at the 7th edition of the Nigeria Auto Journalists Association (NAJA) training/capacity building workshop with the theme: “Accelerating Automobile Industry Recovery Strategy In Post COVID-19 Era,” held in Lagos.
58 Assembly plants were approved by the federal government through the National Automotive Design and Development Council (NADDC) as at 2015 to assemble semi knocked down (SKD) vehicles to be deployed on Nigerian roads.
Jaiyesinmi, who is also the chairman of the Auto & Allied sub-Sectoral group of the Lagos Chamber of Commerce & Industry (LCCI) stated that the decision of President Muhammadu Buhari to decline assent to the National Automotive Industry Development Plan (NAIDP Bill) passed under President Goodluck Jonathan was a setback to the industry. To keep its employees, he disclosed that CFAO had converted their workers in assembly plants to after-sales staff.
“When the National Automotive Design and Development Council (NADDC) came up with the policy, we had it in phases; that is starting with semi knocked down, SKD1 SKD2 and SKD3. It was expected that after 5 years, we would have migrated to CKD (Complete Knocked Down). By 2014, we should have been in CKD but we are still in SKD in 2022.
“We are still in SKD because there is no way we can talk of CKD without the steel industry working and other auxiliary products which have shut down,” he added.
He further pointed out that as a result of the challenges, it was now more profitable to bring in Fully Built Units (FBUs) than assembling, “and this is why less than six assembly plants are now in operation.”
