Osanipin, experts address hidden pain points in Nigeria's Auto Industry

Nigeria’s automotive industry, once hailed as a beacon of hope for local manufacturing, faces a critical challenge. Customers of Nigerian-made vehicles often grapple with delays in accessing spare parts, leaving their vehicles stranded and unrepaired for weeks or even months. This scarcity of essential components not only frustrates consumers but also taints the reputation of local manufacturers.

Joseph Osanipin, the Director-General (DG) of the National Automotive Design and Development Council (NADDC), acknowledged this pressing issue at the Automotive Industry Stakeholders Conference held December 16, 2024 in Lagos. Speaking at the event themed “Strategy for the Current and Sustainable Future of the Auto Industry in Nigeria,” Osanipin emphasised the importance of developing a robust local component manufacturing ecosystem.

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“We need to get it right. Local component development is the bedrock of this sector,” the DG stated. “Without reliable spare parts, the trust in Nigerian-made vehicles will erode. Every assembler must ensure that their vehicles are backed by a seamless spare parts supply chain.”

The Model Proliferation Problem

Another significant challenge is the tendency of some manufacturers to produce multiple car models beyond the capacity of their factories. This overextension leads to operational inefficiencies and worsens the spare parts crisis.

Oluseun Olawore, CEO of Olawore Motor Company addressed this in an interview with Autojournal, describing the approach as a “self-inflicted wound” that adds to operational inefficiencies and the spare parts crisis. “Manufacturers should focus on perfecting two or three models such as commercial models, utility models, and passenger models instead of spreading their resources thin across ten or more,” he said. “When you overproduce, you not only place the factory under duress, dilute your expertise but also make it harder to maintain a steady supply of spare parts.”

“One of the biggest issues we face is the unavailability of spare parts for Nigerian-made vehicles,” Olawore said. “Customers buy cars expecting reliability, but when something goes wrong, they are left stranded for weeks or months waiting for parts. “Manufacturers must focus on a few models and perfect their production and support systems before expanding their range.”

Policy Gaps and Industry Realities

The chairman of the Nigeria Automotive Manufacturers Association (NAMA), Bayo Omagbitse, presented an overview of the industry’s challenges. He revealed that the automotive industry has struggled to meet the expectations of local consumers despite decades of government intervention.

“Many manufacturers are more focused on churning out new models than ensuring a steady supply of spare parts for existing ones,” Omagbitse said. He added that this strategy leads to dissatisfaction among customers who face downtime due to unavailable parts.

Proposed Solutions

To address the challenges plaguing the industry, a multi-faceted approach is essential. First, streamlining vehicle models must take precedence, as focusing on fewer models allows manufacturers to optimise production processes and spare parts availability. Additionally, forging local partnerships between vehicle assemblers and component manufacturers can play a transformative role in creating a robust supply chain tailored to meet the industry’s demands.

Furthermore, government incentives, such as tax breaks and subsidies, are pivotal in driving investments into local component manufacturing and upgrading technology across the sector. Collaboration within the industry is equally crucial; platforms where manufacturers, suppliers, and policymakers converge can standardise processes and improve overall efficiency.

Finally, auto financing presents another critical area of intervention. By providing accessible credit options to vehicle buyers, manufacturers can embed assurances for regular maintenance and spare parts availability, ensuring customers remain confident in their purchase decisions. Together, these strategies form a cohesive roadmap to revitalise Nigeria’s automotive sector.

A Call for Action

For Nigeria to become a hub for the African automotive industry, addressing the spare parts crisis is non-negotiable. A strong focus on local content development and strategic model management is crucial for rebuilding trust among consumers.

“The path to a thriving auto industry is clear,” Osanipin concluded. “We must prioritise quality over quantity, reliability over rapid expansion, and collaboration over competition. Only then can Nigeria take its rightful place as a leader in the global automotive market.”