How Nigeria’s car imports climbed back to ₦1 trillion

Nigeria’s imports of passenger motor cars rebounded sharply in 2025, crossing ₦1 trillion in nine months, as improved foreign exchange stability eased pressure on dealers and buyers.

Data from the National Bureau of Statistics (NBS) showed car imports reached ₦1.01 trillion between January and September 2025. This was up from ₦894.09 billion in the same period of 2024. The increase of ₦113.15 billion represents a 12.66% year-on-year rise.

The rebound followed months of weak demand driven by exchange rate volatility, rising inflation, and high landing costs. Analysts say improved access to dollars restored confidence among importers in the second half of the year.

The recovery was uneven. In the first quarter, imports fell to ₦224.58 billion from ₦238.73 billion a year earlier. The second quarter also declined to ₦254.67 billion from ₦291.93 billion in 2024, as caution remained despite gradual FX improvements.

The turnaround came in the third quarter. Imports surged to ₦527.98 billion between July and September, compared with ₦363.42 billion in the same period last year. The ₦164.56 billion jump more than offset earlier declines.

The United States remained Nigeria’s largest source of imported passenger vehicles. In the first nine months, vehicles traced to the U.S. were valued at ₦415.05 billion, accounting for 41.21% of total imports.

South Africa followed distantly with ₦47.27 billion, representing 4.69%. The United Arab Emirates emerged as a stronger source in the third quarter, with imports worth ₦26.35 billion.

Quarterly data showed used diesel vehicles with engine capacity above 2,500cc dominated imports from the U.S. In the third quarter alone, such vehicles were valued at ₦184.21 billion, nearly double first-quarter levels.

Economists link the rebound to improved stability in the foreign exchange market. According to FCSL Research, the naira appreciated 3.2% in the third quarter to ₦1,480.66 per dollar, supported by stronger dollar inflows and central bank interventions.

External reserves also rose by $2.87 billion to $42.23 billion during the period, helping anchor market confidence, FCSL said.

“FX trading remained within a narrow band, making it one of the most orderly quarters since reforms began,” the firm noted.

CardinalStone Research said moderating inflation and rising reserves should support further currency stability. It expects the naira to close the year between ₦1,400 and ₦1,450 per dollar.

Port operators confirm the rebound on the ground. An official at Ports & Terminal Multipurpose Limited said predictable exchange rates have helped importers plan better.

“Unlike before, importers can now plan ahead. Inflation is slowing and businesses are expanding,” the official said, requesting anonymity.

Freight forwarders also report higher volumes. Thomas Alor, chairman of the PTML chapter of the National Association of Government Approved Freight Forwarders, said vehicle arrivals have increased noticeably.

Licensed customs agents attribute part of the growth to lower duty assessments. Apapa customs agents’ chairman Abayomi Duyile said revised valuation methods reduced inflated clearance costs.

Customs now factor in mileage, depreciation, and wear-and-tear, he said, bringing duties closer to market values.

Despite the rebound, analysts warn that vehicle prices remain high and access to credit is limited. Still, they say predictable FX conditions could support steady demand if stability holds.