Vehicle Production Plans Supported By Port Projects
As South Korean carmakers Hyundai Motor and Kia Motors join the list of companies planning vehicle production projects in Nigeria, BMI believes the work being carried out to tackle congestion at the main port terminals in Lagos is timely and will be supportive of the autos sector's increased trade activity. Hyundai has reportedly already commenced imports of semi knocked down kits for assembly, while it has also spoken of serving customers around Africa, which suggests possible export plans.
The government's Auto Policy ( see 'Automotive Policy Seeks To Lure First Movers', October 4 2013) has already attracted major carmakers such as Nissan Motor, which will begin production in April, and Ashok Leyland, which will expand its existing assembly agreement with local partner Stallion Group. However, given the ambition of the policy to create a new production hub, BMI has previously highlighted the country's transport network as a potential risk to fully achieving this aim, particularly if the industry is aiming to develop export capabilities ( see 'Transport Poses Risk To Nissan's Regional Strategy', October 10 2013).
However, another aim of the policy, according to the government, is to address the development of the industry with a 'holistic approach', which 'takes care of the entire automotive value chain', as stated by Nigeria's Minister of Industry, Trade and Investment, Olusegun Aganga. We believe the recent strategies introduced to increase the throughput of containers at the main Lagos ports will be an advantage as increased volumes of kits and components enter the country ( see 'NPA Tackling Port Congestion As Throughput Growth Continues' February 17).
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