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•Transportation cost to skyrocket –Motor dealers warn
…Beg FG for waiver, say road crashes, car theft, smuggling to worsen
By Uche Usim
With the naira sinking to an all-time low at N1,418/$1 in the parallel market, amid a ravaging inflation at 28.92 per cent, experts insist that the Nigerian economy has manifested all symptoms of a dying entity and warned of dire consequences if concerted efforts were not urgently made to get it out of coma.
Just like other sectors, the transportation wing of the economy has taken a hit, recording a 60 per cent slump in the volume vehicles imported into the country in the last 12 months.
Worse, the local vehicle assembly plants have not been able to produce affordable made-in-Nigeria vehicles for the lower cadre of the country to help address the national transportation nightmare.
The National President, Association of Motor Dealers of Nigeria (AMDON), Ajibola Adedoyin, in a telephone conversation with Daily Sun at the weekend, said the 60 per cent reduction was a conservative estimate as hundreds of his members have dumped vehicle dealership for other ventures just to stay afloat.
He said the development will take a heavy toll on transportation fares as the high cost of vehicles will be passed on to commuters who will have to cough out higher amount of money for the same trip.
He also warned of a frightening surge in road crashes and vehicle smuggling in the nearest future if efforts were not made to crash the price of imported vehicles so transporters can replenish their fleet as and when due.
“Accidents and smuggling will rise astronomically. The cost of clearance at ports or land borders is scary. Not many people can afford that and so beating the system will be worth the risk for many”, he said.
According to him, transporters in Nigeria are currently in dire straits and forced to operate old and worn-out vehicles, which break down frequently or crash in accidents.
He revealed that the prices of foreign pre-owned vehicles, popularly called Tokunbo, have doubled and worsened commuters’ nightmare and generally stifling the economy.
The troubling development, he noted, stems from naira’s rapid depreciation amid volatilities in the foreign exchange market.
Other causes are high duties, levies, taxes, the Vehicle Identification Number (VIN) valuation policy of the Nigeria Customs Service (NCS), rising poverty and weakened purchasing power of consumers.
Adedoyin noted that with ravaging poverty becoming the order of the day, majority of Nigerians can no longer buy imported vehicles.
The development has also hampered transporters’ efforts to replenish their fleet, forcing them operate worn-out vehicles which break down often or get involved in avoidable crashes.
Checks by Daily Sun showed that a Golf 3 sedan used for intra-city and inter-city services that hitherto sold for between N900,000-1.2 million before the naira crash and subsidy removal, now goes for N3.7 million on the average.
The same increase was seen in a Toyota Sienna. It jumped from N3.5 million to about N8 million on the average.
A 2012 Honda Accord now costs between N8-N10 million from the N5.5 it was early last year.
Adedoyin told Daily Sun that the country will soon grind to a halt if efforts were not made to make vehicle importation cheaper and more seamless.
“We are a large population and about 95 per cent of our transportation system is driven by vehicles. We don’t have widespread rail or sea transportation system. It’s mainly by road. So, we must take the issue of vehicles seriously and give the importation some sort of rebate or waivers.
“The economy is suffering and this has safety, security and social implications.
“Imagine where people who sold vehicles are calling and begging us to take them back. It tells you the horror we’re in.
“However, refurbishing vehicles is risking the lives of the people because it gets to a time you must retire the vehicle in the interest of safety”, he said.
The AMDON President also said the body would soon start the campaign on stolen vehicles in the country with a view to alerting the public to be extremely careful and red flags to watch out for when buying pre-owned vehicles (Nigeria used).
According to him, with the current terrible state of the Nigerian economy, it is natural that criminality will be on the rise, especially armed robbery and vehicle theft.
“So, we want to start a campaign on stolen vehicles. As the police fortifies its database on stolen vehicles, we want to partner with them.
“We want to leverage the police ECMR initiative. We want to partner with them on it. It’s an authentication tool. We’ve done our due diligence on it. So, before we buy a car from anyone to resell or use, we run it through the ECMR and there will be a reply which shows we have run a check. There will be a proof of approval.
“We’re going to approach the IGP on it by next week so that if for any reason a stolen vehicle that was not detected by the ECMR will not be the liability of the car dealer but the police.
In all, we hope the federal government hears our cry to give waivers on imported vehicles. Subsidy removal and high cost of vehicles is a double hit”, he stated.
Car dealer stands visited by Daily Sun over the weekend show reflected the economy horror Nigerians are contending with.
James Kalu, a car dealer in Lekki lamented. “Before 2023, I used to have at least 20 vehicles here. But today, they’re just six of them. No money to import. Dollar is very scarce and costly. I’ll quit this business before June. Sales are low, no vehicles to buy. It’s terrible”.
Another dealer, Maxwell Monday, said it was becoming increasingly hard to survive as a car dealer.
“If you manage to import five vehicles, you don’t know when you’ll sell them. It ties your money down. Turn over is so low. This is not business, it’s detention”, he lamented.
