Manufacturing industry: Made in Africa

Manufacturing industry: Made in Africa

Nigeria shakes off rust
In Nigeria, recent developments have renewed hopes that the country’s floundering car manufacturing sector could soon take off once again. In October, Nigeria’s federal government introduced the National Automotive Policy, to revive the country’s auto manufacturing base. Part of the strategy hinges on the creation of automotive hubs in three Nigerian regions.

The Minister of Industry, Trade and Investment, Olusegun Aganga, hopes that the policy will lead to the creation of a minimum of 700,000 jobs, including 210,000 posts in small and medium-sized firms that will provide assembly plants with supplies.

The director general of the National Automotive Council, Engr. Aminu Jala, says that Renault has arranged to assemble cars at Volkswagen’s old factory in Lagos. Nissan has already announced that this is what it intends to do; it is to roll out its first locally made cars in April – namely its 4 x 4 Utility SUV. Meanwhile, there are reports that Toyota is carrying out a feasibility study for vehicle assembly.

The breakthrough in Nigeria is notable, considering that the country has struggled to revive its car industry for several decades. The Nigerian automotive industry’s history is traceable back to the 1970s when the Nigerian government forged several partnerships with foreign firms. Six assembly plants – four for trucks and two for cars – sprang up between the 1970s until 1980.

These included Volkswagen of Nigeria Limited in Lagos; Peugeot Automobile Nigeria Limited in Kaduna; Anambra Motor Manufacturing Limited in Emene, Enugu; National Truck Manufacturers in Kano (Fiat trucks); Steyr Nigeria Limited; and Leyland Nigeria Limited in Ibadan. Although production capacity was estimated to be over 170,000 vehicles, the sector shrank in the 1980s and 1990s – the importing of superior new high-technology and competitively priced second-hand vehicles represented tough competition.

One of the major criticisms most frequently levelled against the Nigerian auto-manufacturing industry is that inconsistent policy making by government has damaged it. Although the state has been outwardly very supportive of the sector, patronage and support for companies has been less than adequate to really propel the industry forward. This was perhaps the case with NTM, a joint venture between Fiat and the Nigerian government, aimed at manufacturing trucks and tractors in the country. In the end, the project lacked the necessary support from the government and ultimately the company was privatised and became known as Art Engineering and Construction Limited in March 2003.


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Written by African Business Magazine

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