Q2 2024: Weak naira forces 83% decrease in Nigeria’s used vehicle import bill

Nigeria’s used vehicle import bill has dropped dramatically by 83% in the first half of 2024, according to the National Bureau of Statistics (NBS). The figure plummeted to N138.62 billion from N819.15 billion in the same period last year, reflecting a sharp decline in second-hand vehicle imports, known locally as “Tokunbo.”

In the second quarter of 2024 alone, the value of imported used vehicles was N138.62 billion, down from N749.92 billion in Q2 2023, representing a year-on-year drop of 81.5%. A significant portion of these vehicles came from the United States, with total imports from America in Q2 2024 reaching N971.84 billion.

The NBS report also noted a decrease in the All Products Terms of Trade (TOT) Index, which fell by 0.06 percentage points. This decline comes despite the Nigeria Customs Service suspending its 25% penalty on unlawfully imported cars in March 2024.

The forex crisis has been a major factor behind the fall in vehicle imports, with the devaluation of the Naira pushing import costs higher. The exchange rate between the Naira and the U.S. dollar surged to N1540.78 last week, a stark contrast to N460 in June 2023.

A local car dealer lamented, “The cost of bringing in cars has doubled in the past year. Many of us are struggling to keep up with demand at these prices.”

This sharp decline in vehicle imports reflects the broader economic challenges Nigeria faces amid ongoing currency volatility and rising inflation, which has put pressure on businesses and consumers alike.

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