Nigeria, recorded a total sum of N1.28 trillion as the value of “used vehicles” (popularly known as Tokunbo) and motorcycles imported in one year (Q3 2019 – Q2 2020), implying an increase of 42%, compared to N899 billion recorded in the corresponding period (Q3 2018 – Q2 2019).
However, in a visit to some used car dealers in Abuja, complaints were rife regarding several factors including naira inflation, import duties and the general economic realities which have affected the purchasing power of Nigerians.
At Oloa Kintana Motors at the Customs Area of Karu, the car dealer says car prices have risen by more than 15% in a 12-month period. When asked about how government policy was affecting his business, the dealer was quick to state that “due to border closure, cars stopped coming from the borders, which made the prices of the available cars for sale in Nigeria go higher.”
The dealer added that about this time last year a used Toyota Corolla (2005 model) sold for roughly N1.2 million but the same car currently sells for about N1.6 million now; while models like the 2008 versions went from a little over N2 million last year to just over N3 million now.
The dealer also complained that patronage had been consistently low this year, compared to the pre-covid period, as the prevailing economic challenges had whittled down the purchasing power of consumers.
At the Karu roundabout area, car dealers at Mazfallah Plaza confirmed that used car prices had risen this year by over 15%, stating that the government policy has made it more expensive to bring cars into the country as it has become difficult to get cars through the land borders. They also cited the economic fallout of the COVID-19 pandemic as part of the reasons for low patronage.
“A Nigerian-used Corolla 2009 sells for N2.4 million now, compared to about N2 million last year; while an American-used one sells for over N3 million,” one of the dealers lamented.
The story was not much different at car dealerships along the Kubwa Expressway. At US Matasa Investment ltd, which sells a range of used luxury cars, the Chairman stated that this period last year was unequivocally better than the present time in terms of cost of vehicles and volume of sales. “A 2010 Mercedes Benz C300 sold for N4.5 million this time last year, today it goes for nearly N5.5 million,” he said.
Despite the revised import duty tariff for vehicles which was announced by the government in January and reported by Nairametrics, car dealers are still faced with dismal patronage because of the poor economic situation of the country. Not being a level-one need on Maslow’s famous hierarchy of human needs and with the rising inflation figures (particularly food inflation), Abuja residents appear to be prioritising their basic needs over lifestyle products such as cars.