A decade on: How Nigeria’s new auto policy departs from, builds on 2013 blueprint

Orisemeke Benjamin

Ten years after the Federal Government first tried to force Nigeria’s automotive sector off imports and onto local assembly lines, a new policy has been rolled out to pick up where the old one fell short, this time with electric vehicles in the mix.

A review of the original 2013 National Automotive Council (NAC) document, “Measures to Transform the Nigerian Automotive Industry and Attract Investment into the Sector,” alongside the National Automotive Industry Development Plan (NAIDP) 2023–2033 adopted by the Federal Executive Council in May 2023, shows a policy that has grown broader, more ambitious in its targets, and structurally different in one key respect: it now treats electrification as central rather than absent.

Same problem, new decade

The 2013 plan was designed to run from 2013 to 2024, nested within the Nigerian Industrial Revolution Plan (NIRP), a five-year programme of the then-Federal Ministry of Industry, Trade and Investment aimed at lifting manufacturing’s share of GDP from 4 percent to above 10 percent. Its fiscal incentives were staggered across three windows: 2013-2015, 2016-2018 and 2019-2024. It was built around tariffs on Completely Knocked Down (CKD) and Semi-Knocked Down (SKD I and II) kits, rising as vehicles arrived more fully assembled.

The 2023-2033 plan, developed by the National Automotive Design and Development Council (NADDC), retains that CKD/SKD tariff logic but resets it for a new ten-year cycle. Industry Minister Otunba Adeniyi Adebayo, announcing the plan’s approval alongside Nigeria’s first-ever national investment policy, said the new framework was designed to be an improvement on its 2013 predecessor and would help the country transition from combustion engines toward electric and solar-powered vehicles.

A new local-content number, a new metric

Where the 2013 document set no single local-content percentage, rather instead listing specific parts categories such as welded components, electricals, plastics and filters for phased localisation, contingent on plants hitting at least 5,000 units sold per model, the 2023 plan sets an explicit target: 40 percent local content. It also introduces a target that did not exist a decade earlier: 30 percent of locally produced vehicles to be electric by 2032, according to the International Energy Agency’s policy database.

Industry trackers say the plan additionally targets 200,000 locally assembled vehicles annually and a shift in production away from SKD toward CKD and eventually full local manufacture; a more aggressive localisation trajectory than the 2013 planned parts-by-parts approach.

The defining addition

Perhaps the starkest difference between the two documents is one of omission rather than revision. The 2013 plan makes no reference to electric vehicles anywhere in its text; its entire fiscal architecture: levies, duty concessions, CKD/SKD tariff bands, was built exclusively around combustion-engine assembly. The 2023-2033 plan folds in EV-specific incentives from the outset, placing Nigeria alongside countries such as Indonesia, Malaysia and Pakistan that have introduced comparable CKD duty concessions for electric vehicles over the same period.

Institutional handover

The 2013 plan was issued under the NAC, operating within the FMITI-led NIRP framework. By 2023, primary responsibility for the auto policy had moved to NADDC, which has since paired implementation with the newly created National Investment Policy (NInP), giving the current plan a broader investment framework than the 2013 version had.

What the 2013 plan delivered and didn’t

Government officials have pointed to measurable gains from the 2013-2023 cycle. Import duties on completely built-up vehicles were raised sharply, from 20 percent to 70 percent, to push manufacturers toward local assembly, though the accompanying target, 80 percent local production and 500,000 vehicles assembled annually by 2023 have not been met in full. NADDC figures put 79 companies registered under the scheme, with 34 reaching full commercial operation, and government officials have cited roughly $1 billion worth of locally assembled vehicles from 17 companies as evidence of progress from what experts have described as a sector that had moved “from zero to thousands of cars.”

Analysts, however, note that implementation across the decade was uneven, weighed down by unreliable electricity supply, high logistics costs in moving kits from ports to assembly plants, and a thin domestic supplier base for metal, plastic and electronic components, the same structural gaps the 2023-2033 plan was written to close.