Thursday, June 2, 2016 3:21 pm
Nigeria’s National Automotive Design and Development Council (NADDC) says it has shifted focus to local content development, as the second phase of the implementation process of the automotive policy introduced to encourage local production of vehicles.
The Director General of the council, Mr Aminu Jalal who said this during an interview with journalists on Thursday noted that the first objective of the automotive policy which is to bring back automotive assembly plants to Nigeria has been achieved, hence the new focus.
“The auto policy has two major objectives: to bring back automotive assembly operations and to develop local content. We have achieved the first objective.
“Emphasis has now shifted to local content development aimed at developing the local capacity to produce automotive components needed by assembly plants using available local human and material resources.
Jalal said the Council is targeting 40 per cent local content development in the automotive sector within the next five years.
“Assembly operations alone account for about 15 to 20 per cent of the cost of the vehicle.
“ When you add local content you now increase the value added.
“We are hoping that within the next five years, we will reach value addition of about 30 to 40 per cent,’’ he said.
Jalal said that five South African companies had indicated interest in establishing component manufacturing plants in the country.
He added that some Chinese investors had also indicated interest and were already exploring opportunities in that area.
“Local content development in the automotive sector comes with huge requirements both on the part of the suppliers and the assembly plants.
“The suppliers require the local assembly plants to attain certain production level that is enough to support their business before they will come in.
“The assembly plants, on their part, want component supply at competitive cost, in required quality and quantity, and at the required delivery times.
“The component suppliers also need to be able to upgrade their products to keep up with the pace in the industry which you know is very fast,’’ he said.
He said that the council was undertaking a “benchmarking study’’ to identify the gap between demand and supply of components in the industry.
The aim of the study, he said, was to gather adequate information that would enable suppliers to meet the demands of the assembly plants.