2020: Wobbling year for auto

By Moses Akaigwe

Two of the most discussed issues in the auto sector as the year 2019 gave way to 2020 were the wobbly implementation of the automotive policy and the gloom cast on the local industry by the decline of presidential assent to the Nigeria Automotive Industry Development Plan (NAIDP) Fiscal Incentive and Guarantees Bill.

However, while stakeholders reflected on the “unprecedented lull” in the previous years and wondered if it would continue in 2020, they had no inkling that the outbreak of a deadly disease – the coronavirus (COVID-19) – was going to make the new year the worst the industry had ever witnessed in recent times.

Their being apprehensive about the auto policy was understandable because President Muhammadu Buhari had, in July 2019, declined assent to the bill as passed by the National Assembly.

As soon as 2020 set in, the director-general of the National Automotive Design and Development Council (NADDC), Jelani Aliyu, raised the flagging hopes in the industry by mobilising stakeholders towards reviewing the document for re-submission to the National Assembly.

It was learnt that the NADDC undertook the review of the bill in liaison with stakeholders, especially the Federal Ministry of Industries, Trade and investment (FMITI), with a view to presenting it this time as an executive bill to facilitate its speedy passage by the legislators and assent by the President.

The NADDC DG had pledged that the bill, considered the most important follow-up to the introduction of the policy itself owing to the legal framework it would give to the initiative and the encouraging signal to foreign investors, especially OEMs, would be improved on and re-presented. But it was not to be.

Meanwhile, another development that raised hopes early in the year, as early as February, was the report that the Dangote Group had continued its remarkable patronage of Shacman brand of heavy duty trucks assembled at ANAMMCO, Emene, near Enugu, in partnership with Transit Support Services (TSS), a sister company to ABC Transport Plc.

Through the managing dircetor of ABC Transport, Frank Nneji, and general manager, corporate communications, Dangote Group, Esan Sunday, journalists who visited the plant on February 22 learnt that 3,500 units of the Shacman trucks of varied models, valued at about N63 billion, had been assembled for the Dangote Group in the past few years.

Esan explained that an interplay of factors, including the desire to have an impactful presence in the South-East, the recognition of Shacman as reliable heavy duty vehicles, and the growing need for such vehicles within the continuously expanding conglomerate, influenced the sustained patronage of the trucks from the ANAMMCO plant.

TSS sibling, Shacman Nigeria, had later in the year announced the introduction of two fire vehicle models,  Shacman F2000 and L3000, which joined the brand’s line-up featuring tractor heads, dump/tipper trucks, mixer and lorry trucks.

But as the stakeholders were still trying to reboot their survival strategies in the new year and turn around the lull that had pervaded the sector for some years, the COVID-19 pandemic hit Nigeria, leading to the introduction of some measures to counter its spread.

The lockdown, ban on inter-state travel and other restrictions imposed on the country by the federal and state governments from March to stop the ravaging disease paralysed social and economic activities in the country. And the already trudging auto sector further took a blow.

It was while the lockdown lasted that the industry lost two of its most prominent players, namely, the chairman of Globe Motors Holdings Nigeria Limited, William Anumudu, who died on Tuesday, April 1, 2020, and the billionaire/founder of Tonimas Group of Companies, Chief Anthony Obiagboso Enukeme, who died on Monday, June 8, 2020, aged 76.

Even as the coronavirus continued its rampage in May, founder of the Coscharis Group, Dr. Cosmas Maduka, was honoured on three different international and local platforms in May as a distinguished entrepreneur. The first award was from the globally respected consulting firm, Ernst & Young; the EY bestowed on him the Entrepreneur of the Year in the Master Class category for West Africa.

The second, from the Enugu Chamber of Commerce, Industry, Mines & Agriculture, was the Keyman Award recognising him as an outstanding investor in the growth and development of Automobile/Agro-Allied Industry.  Independent Newspapers Limited also named him the Real Sector Investor of the Year.

In June, the Innoson Group confirmed that it had been awarded 11 offshore oil wells by the government of Sierra Leone through the youngest member of the family, Innoson Oil & Gas Limited.

A close aide of Dr. Innocent Chukwuma, the IVM Innoson Group chairman, informed Daily Sun that Innoson Oil & Gas team of experts in the industry had months ago participated in a very competitive bid process that featured companies from different countries, and another owned by a billionaire from the east; it was warmly acknowledged by the authorities in the West African country.

Later in the year, Innoson introduced two competitively priced vehicle models, IVM Connect, going for N4.5 million, and seven-seater IVM shuttle bus with a price tag of N5 million. Hundreds of units of Connect were used to launch the pilot scheme of the much-awaited IVM Cruise ride-hailing service in Enugu in November. The youth empowerment programme, which requires the participants to operate the vehicles and make regular returns for about three years, after which they would take ownership, is expected to reach other parts of the country later.

By the time the lockdown was eased and activities gradually gathered momentum, it led to motoring history being made on Friday, August 7, when Stallion Auto Keke Limited, the exclusive distributor of Bajaj Auto for three-wheeler and four-wheeler business, kicked off the first keke rally in Nigeria. The rally covered about 5,000 kilometres, from Lagos to states like Ogun, Oyo, Kwara, Kogi, Benue, Enugu, Ebonyi, Cross River, Akwa Ibom, Abia, Rivers, Anambra, Delta, Edo, Ondo, Ekiti and Osun.

On Monday, September 21, The Sun Motoring exclusively reported the sale of PAN Nigeria Limited (formerly Peugeot Automobile Nigeria Limited) by the Asset Management Corporation of Nigeria (AMCON) to a new core investor, Nesbitt Investment Limited. And to confirm the news story, AMCON handed over the 45-year-old company to the new owners a few weeks later.

But, arguably, one of the most memorable developments in the year, was the launch of one of Nigeria’s first locally assembled electric vehicles, the Hyundai Kona compact SUV, by the Stallion Group. The vehicle was unveiled by Lagos State Governor Babajide Sanwo-Olu at the roll-out ceremony held inside the Stallion Group’s VON Automobile assembly plant on the Lagos-Badagry Expressway, Ojo, in November.

Impressed with the pioneering move by the Stallion Group in EV technology, which he observed was in line with government’s drive towards diversifying from total dependence on fossil fuel, Gov. Sanwo-Olu announced that his government would set up public charging points in various parts of the state, starting with the secretariat area in Alausa.

History was made on Tuesday, December 1, when President Muhammadu Buhari launched the ambitious Auto Gas Policy, with the Federal Government targeting to convert about one million automobiles, mainly passenger and haulage vehicles in the country, to start running on gas, instead of fossil fuel, before the end of this year.

A few weeks later, in Lagos, a new automaker, Nord Automobiles Limited,  launched five new vehicle models assembled in Nigeria, including a sedan named A3; A5 SUV; Flit mini bus; Max pick-up; and Nord Tank pickup.

Last month, Coscharis Motors Plc officially re-introduced the Renault brand into the Nigerian market with complementary after-sales facilities in Lagos, Abuja, Port Harcourt and Uyo. While Duster and Logan are assembled at the company’s plant in Lagos, Koleos, Kwid and Oroch, which is to be introduced on a later date, are presently being brought in fully-built.

Also in December, Mikano Motors, a subsidiary of Mikano International Limited, organised a test-drive of locally assembled Geely Emgrand 7 sedan and Geely X7 Sports SUV for members of the motoring press at the company’s new assembly plant located at Karameh City, along Lagos-Ibadan Expressway.

Lamentably, the year ended worse than it started for the industry as the National Assembly in December passed the controversial 2020 Finance Bill approved by the Federal Executive Council on Wednesday, November 18, despite protests by stakeholders, including the Innoson Vehicles’ chairman and relevant associations.

It was learnt that it took only six days for the document to get presidential assent, and has already taken effect from the first week of January 2021.

A section of the act reduces import duties on tractors from 35 per cent to 10; reduction of duties on motor vehicles for the transportation of goods from 35 per cent to 10 per cent; and reduction of levy on motor vehicles for the transportation of persons from 35 per cent to 5 per cent.

To many in the industry, the coming into effect of the Finance Act is enough basis to conclude that 2021 will not be any better than last year.

The post 2020: Wobbling year for auto appeared first on The Sun Nigeria.

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