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Nigeria’s market evades Japan’s automobile supply crisis

By on March 25, 2011

AS Japan continues to count the cost of its losses to the recent disaster in the country, Nigeria’s automobile market may have been immuned from the concomitant vehicle supply crisis from the Far East Asian country.

Reason: The nation’s vehicle dealers source most of their respective stocks of made-in-Japan automobiles from South Africa and other countries.

But the local automobile manufacturers have again described the non-revival of the assembly plants in Nigeria as “indefensible’, with South Africa now serving as the hub for vehicle production and marketing in Africa.

More than one week after the earthquake in Japan, factory shutdowns have disrupted the country’s automobile exports to the United States of America (USA) and some other locations across the world.

But in Nigeria, prominent dealers of Japanese products such as Toyota, Mazda, Nissan and Honda said they were not affected directly as they source some of their products from South Africa and other locations.

Besides, representative of Mazda in Nigeria, Nuel Ojei Motors, explained on Wednesday that the company presently has enough stock in its warehouse.

When contacted, the authorised dealer of Toyota in Nigeria, Toyota Nigeria Limited (TNL), equally said the effects of the earthquakes and tsunami in Japan were not affecting its operations in the country.

Also, a source from Kewalram Motors- distributor of Mitsubishi products, who spoke on condition of anonymity, explained that only big markets such as United States and United Kingdom, among others, can be affected by the development in Japan.

He added that since the reforms in the banking sector started about two years ago, the automobile market in Nigeria dropped significantly.

The source added that numerous Nigerians presently settle for Chinese and Korean products, because of their relatively cheap price tags.

Also, the Marketing Manager of Alliance Autos- distributors of Nissan in Nigeria, Mr H. Arora, said the problems in Japan have not been affecting their services in the country.

According to him, the firm has enough products in stock to take care of its customer base in the country.

Besides, he said most of their stocks are sourced from South Africa and other markets, thus making the products available to its customers irrespective of the quake in Japan.

Nigerian Automotive Manufacturers Association (NAMA), through its Executive Director, Arthur Madueke, accused the Federal Government of focusing “on short term goal of earning more revenue than the implications of its action on industrialisation, economic activities, employment and vision 20:20:20”.

According to another industrialist and automobile expert, Dr David Obi, a well-developed auto industry will boost the development of the local content industry.

He said: “Since component parts manufacturing is the fundamental basis for the automobile industry, it is therefore, obvious that special attention and energy should be committed to support its development.

“Because of the multiplicity of components involved in parts manufacturing, its importance cannot be over emphasized.”

He said the major challenge of the industry was lack of the political will by the nation’s administrators to play supporting roles in developing the auto industry.

He added: “Just look across to the United States of America, Germany and Japan to see how their governments intervened and have continued to support their automobile industries by all imaginable means– financial bailout, legislative and tariff measures and patronage.”

On his part, Director-General of National Automotive Council (NAC), Aminu Jalal, said the plight of the industry was mainly due to lack of patronage by government and the massive importation of second-hand vehicles.

He said the industry also performed poorly because of inadequate infrastructure, shrunken market that led to low capacity utilisation and uncontrolled importation of fully built cars.

Meanwhile, Chief Executive Officer Nissan Motor Company of Japan, Carlos Ghosn said about 40 component suppliers in Japan remain in difficulty after the nation’s record earthquake, complicating automakers’ efforts to restart car production.

Electronic components, plastics and rubber are in short supply and will affect Japanese automakers and rivals outside the country, Ghosn, 57, said.

Source : Guardian