Survival of auto industry depends on revival of Ajaokuta Steel –Union

The Automobile Boatyard, Transport Equipment and Allied Senior Staff Association, says Nigeria’s automobile industry will develop if the Federal Government resuscitates Ajaokuta Steel Company.

The Automobile Boatyard, Transport Equipment and Allied Senior Staff Association, says Nigeria’s automobile industry will develop if the Federal Government resuscitates Ajaokuta Steel Company.
Sola Olorunfemi, Acting General-Secretary, AUTOBATE, spoke to the News Agency of Nigeria in Lagos on the reasons for the slow growth in the automobile industry.
Olorunfemi said that the resuscitation of Ajaokuta Steel would help automobile producers in Nigeria to get materials to produce vehicles rather than import them.
He said that local automobile producers usually imported every part they needed to assemble a vehicle and this had adversely affected the cost of local produce.
According to him, analysts have said that Nigeria has the largest market for second hand cars known as `tokunbo’, which accounted for 74 per cent of all imported vehicles.
He said: “Tokunbo or fairly used cars are flourishing because the cost is lower even with the 35 per cent duty paid on imported vehicles, people still buy them.
“The 35 per cent levy imposed on new cars as contained in the 2013 National Automotive Policy, was to curb importation, rather it has reduce the number of people that can purchase new vehicles.”
The union scribe said till date, there was increase in importation of accidental cars because of 30 per cent rebate on it.
He said that the automotive policy was meant to discourage importation and encourage local production; unfortunately it did not because producers import all their materials.
He said that for the automobile industry to grow, government must revive Ajaokuta Steel, which would also help reduce unemployment rate.

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