By Theodore Opara
The Nigerian Automotive Manufacturers Association, NAMA has advised the Federal Government to complement its 2026 fiscal policy reforms with strong industrial protection measures, warning that tariff liberalisation without adequate safeguards could threaten investments in Nigeria’s automotive manufacturing sector.
In a position paper submitted to the Minister of Industry, Trade and Investment and copied to the National Automotive Design and Development Council (NADDC), the association argued that while the new fiscal measures promote trade liberalisation, they do not provide the level of industrial support required to sustain local vehicle assembly and component manufacturing.
The document, signed by NAMA Chairman, Mr. Bawo Omagbitse, and the association’s Executive Director/Chief Executive Officer, Dr. Harpreet Singh, commended the Federal Government’s efforts to stimulate economic growth and align Nigeria’s trade policy with the ECOWAS Common External Tariff and the African Continental Free Trade Area (AfCFTA).
NAMA also welcomed initiatives promoting locally manufactured vehicles, the End-of-Life Vehicle Policy and the Vehicle Conformity Assessment Programme. However, it expressed concern that the reduced duty gap between imported fully built vehicles and locally assembled units could weaken the competitiveness of domestic manufacturers.
According to the association, narrowing the tariff differential could erode decades of investment aimed at building Nigeria’s automotive industry by reducing the protection local assemblers need to achieve economies of scale and deepen local content.
“Our automotive industry is still at an infant-to-intermediate stage. Affordability for consumers and protection for investments that create jobs are not mutually exclusive, and both objectives should progress together,” Omagbitse said.
NAMA cited Nigerian Ports Authority data showing that vehicle imports increased by 67 per cent, rising from 35,262 units in the first quarter of 2025 to 58,870 units during the same period in 2026. It said the surge reflected importers’ expectations of lower duties on fully built vehicles ahead of the implementation of the new fiscal measures.
The association warned that premature market liberalisation could lead to increased vehicle imports, reduced local assembly volumes, lower factory capacity utilisation and weaker incentives for investment in assembly plants and component manufacturing, including tyres, batteries, plastics, automotive glass and other locally produced parts.
Singh said the association supports the government’s objectives of improving affordability, boosting revenue and advancing regional trade integration but stressed that these goals should be implemented alongside industrial incentives.
“Our request is simply that these reforms be sequenced with the industrial support measures that successful automotive economies established before opening their markets”, he said.
NAMA pointed to countries such as Thailand, Morocco, South Africa and China, noting that they combined tariff protection with production incentives, supplier development programmes, export promotion and infrastructure support before fully liberalising their automotive sectors.
Reviewing Nigeria’s automotive policy between 2014 and 2020, the association acknowledged that local content development and production capacity remained below expectations, blaming the situation largely on the absence of legislation backing the Nigeria Automotive Industry Development Plan (NAIDP) and the resulting lack of long-term policy certainty for investors.
To strengthen the industry, NAMA proposed restoring a wider duty differential between imported and locally assembled vehicles, making consultations with NADDC and the Ministry mandatory before introducing future automotive fiscal policies, and urgently passing the NAIDP into law.
It also recommended production-linked incentives, the establishment of an automotive supplier development fund, priority foreign exchange access for industrial inputs, and dedicated energy and logistics support for manufacturers.
“Nigeria risks becoming a major vehicle consumption market without developing into a significant automotive manufacturing hub,” the association warned.
NAMA reaffirmed its commitment to supporting the Federal Government’s economic reform agenda and expressed its readiness to continue engaging with the Minister of Industry, Trade and Investment and the Director-General of NADDC on policies that promote sustainable growth in Nigeria’s automotive industry
