REVIVING THE AUTOMOTIVE INDUSTRY
The recent call by the National Automotive Council (NAC) for N150 billion special intervention fund to revive the nation's ailing automotive industry is in order, provided that the bailout will, indeed, put the automotive industry back to productivity and high profitability.
While making the call during a courtesy visit to the Minister of State for Commerce and Industry, Mrs. Josephine Tapgun, the chairman of the board of NAC, Alhaji Yahaya Mafindi, explained that the government needs to bail out the industry in view of its importance in job creation, technology acquisition as well as its role as a precursor to industrialization.
There are other cogent reasons that should compel the government to revive the auto industry. These include the fact that the over three decades old industry has the capacity to produce 108,000 cars, 56,000 commercial vehicles, 6,000 tractors, 1.2 million motorcycles and over one million bicycles, annually.
Besides, the industry can boost the business of over 50 auto component manufacturers. Some of them are original equipment manufacturers (OEM), while others are in the supply after sales market. Right now, the capacity utilization in the sub-sector, which was 90 percent in 1981, is 10 percent in automotive assembly and 40 percent in components manufacture.
There are many benefits the country could gain if the auto industry is revived. The resuscitation of the industry will usher in significant investment opportunities in the manufacture of vehicles, motorcycles and bicycles. This is in addition to their components and spares.
If the programme is well implemented, there is every likelihood that the nation will, in future, become the vehicle manufacturing centre for West African countries.
The fortunes of the nation's auto industry witnessed great decline in the 1980s and 1990s. Stakeholders in the industry traced the down turn to lack of adequate engineering infrastructure, shrunken market, uncontrolled imports of fully built-up units and lack of protective and incentive measures.
The sector also experienced partial implementation of partnership agreements and lack of patronage by government and its agencies, which contributed significantly to its dwindling fortunes.
The concerns expressed by NAC are genuine and patriotic. That the nation's automotive industry needs to be revived is stating the obvious. It makes economic sense to do so. We cannot rely on importation for all our automobile needs. Having some of these vehicles assembled here has some economic benefits. Besides generating revenue for the government, it will create jobs and impart some automotive technological expertise in our engineers.
The government should, therefore, come out with far-reaching measures to bring the industry back to life. Let all the partnership agreements that brought these companies into being be revisited with a view to reviving them.
Anything that could boost the local auto industry should be encouraged by the government and the people of Nigeria. The nation's long-neglected automotive industry holds the promise for a made-in-Nigeria car.
While we canvass support for this laudable project, there is the need to conduct a proper audit of past investments in the sector. In reviving the industry, care must be taken to adhere to the principles of accountability. The bailout should be for those companies that are viable. Only auto companies that are going concerns should benefit. Even then, peculiar needs of the companies should be ascertained before bailout is offered.
All the factors that contributed to the failure of the industry in the past should be addressed before new funds are injected. Above all, let Nigerians, government and its agencies patronise products of our local auto industry. That is the best way to keep them in business.