Transport stakeholders say the Federal Government’s reduction in vehicle import duties has provided modest relief but is yet to transform the transport sector.
The stakeholders expressed their views in separate interviews with reporters on Tuesday in Abuja.
They reacted to the Federal Government’s recent reduction in vehicle import duties and levies, aimed at making vehicles more affordable.
They noted that exchange rate volatility, high freight costs, and multiple levies continue to undermine the expected benefits of the policy.
The Chief Executive of Ojigwe Automobiles Ltd., Mr. Nwachukwu Kenneth, said the policy offered some relief but had not yet brought significant changes to the vehicle market.
He explained that clearing costs had dropped, especially for small-engine and “Tokunbo” vehicles, since early July. According to him, inquiries and sales of fuel-efficient and popular used vehicles (Tokunbo) have also increased modestly.
“Clearing costs have reduced, especially for small-engine and Tokunbo vehicles. Newer imports are slightly cheaper. Since early July, inquiries and price checks have increased. Sales of popular Tokunbo and fuel-efficient vehicles have picked up modestly,” he said.
Kenneth, however, noted that exchange rate volatility continued to erode the gains from the policy. He listed high freight charges, port costs, the National Automotive Council levy, 7.5 per cent Value Added Tax (VAT), and clearing fees as additional burdens.
He also identified inflation, logistics costs, and limited dollar supply as factors affecting final vehicle prices.
According to him, the policy’s impact is moderately positive for affordable vehicles and transport operators. He added that sustained benefits would depend on exchange rate stability, lower ancillary costs, and improved economic conditions.
Corroborating his position, another car dealer, Mr. Haruna Sanusi, said the policy had yet to significantly impact the transport sector. Sanusi attributed the limited impact to persistent exchange rate fluctuations.
He said inflation, fuel prices, and the extent to which importers passed savings to consumers would determine the policy’s success.
Similarly, a commuter, Mr. Adeniji Adeyinka, said the policy’s full impact might not be felt for a long time due to limited implementation.
“The full effect could take a decade to materialise. Of course, it will have effects in the short term, but in the long run, we will see the effects on the cost of transportation,” he said.
Adeyinka added that fluctuating fuel prices made the policy’s short-term impact difficult to assess, though long-term benefits could still emerge.
A transporter, Mrs. Agnes James, called for a comprehensive review of transportation costs. She said freight, shipping, and port handling charges should also be reduced.
James noted that lower transport costs would enable operators to reduce fares and upgrade to newer vehicles. However, she said fuel and maintenance costs would also influence such outcomes.
She added that the policy could encourage business expansion, create jobs, and boost trade if complementary costs were reduced.
“For businesses, especially SMEs in logistics and transport, the cut is supposed to reduce fleet acquisition costs and operating expenses, but none of that is happening,” she said.
Another transporter, Mr. Arinze Ezeigwe, said the policy had made no noticeable difference. He noted that vehicle parts and fuel prices remained high.
“The essence of the policy is to make vehicles more affordable, support businesses, and lower transportation costs, but that’s not the situation right now,” he said.
The Federal Government recently announced reductions in vehicle import duties and levies to make vehicles more affordable for individuals and businesses, lower transportation costs, and improve access to newer vehicles.
Stakeholders, however, say broader economic reforms are needed before the policy can deliver meaningful and lasting benefits.
