Senator Fadahunsi: Expediting Nigeria National Automotive Industry Bill 2026

• The National Assembly is committed to fast-tracking the proposed Nigeria National Automotive Industry Bill 2026 to boost local manufacturing and reduce import dependence.
• The bill aims to protect investments in local vehicle assembly, promote local content, and conserve Nigeria's foreign exchange reserves.
• Senator Francis Adenigba Fadahunsi highlighted economic losses from imported used vehicles and urged stronger incentives for local patronage.
• PAN Nigeria Limited, with an installed capacity of 90,000 vehicles annually, has seen production decline and local content fall from 40% to below 4% due to various challenges.
• Both legislative leaders and industry stakeholders are advocating for urgent passage of the bill to foster a more competitive and self-reliant automotive sector.

This crucial legislation is designed to safeguard investments within the local vehicle assembly sector, foster increased local content in manufacturing, and contribute to the conservation of Nigeria's vital foreign exchange reserves.

The Nigerian National Assembly is intensifying efforts to bolster the nation's automotive manufacturing capabilities and significantly reduce its reliance on imported vehicles. Lawmakers have unequivocally stated that Nigeria can no longer tolerate being a destination for foreign used vehicles. In a decisive move, the Senate Committee on Industry has committed to expediting the proposed Nigeria National Automotive Industry Bill 2026. This crucial legislation is designed to safeguard investments within the local vehicle assembly sector, foster increased local content in manufacturing, and contribute to the conservation of Nigeria's vital foreign exchange reserves.

This pledge was made by Senator Francis Adenigba Fadahunsi, Chairman of the Senate Committee on Industry, during a recent inspection of PAN Nigeria Limited's facilities in Kaduna. The visit included committee members alongside officials from the National Automotive Design and Development Council (NADDC). Senator Fadahunsi, drawing on his background as a retired customs officer, highlighted the substantial economic drain caused by the continuous influx of used foreign vehicles, particularly their detrimental effect on Nigeria's foreign exchange reserves. He emphasized the urgent need for the Federal Government to implement robust incentives that encourage Nigerian consumers to choose locally manufactured vehicles, asserting that Nigerian engineers possess the expertise to produce transportation solutions tailored to domestic conditions.

The committee's inspection revealed that vehicles and tricycles produced domestically offer viable alternatives to imported models. Senator Fadahunsi underscored that the Federal Government should acknowledge these superior local options, which Nigerian engineers can provide to mitigate the reliance on imported vehicles and tricycles, especially those used by rural populations. He further pointed out that the PAN facility, spanning nearly 300,000 square meters, represents a significant national industrial asset. Its full operational capacity could substantially boost employment, drive economic growth, and provide affordable transportation solutions across the country.

At peak production, the PAN Nigeria Limited facility has the potential to employ over 3,000 individuals. Furthermore, its comprehensive training programs have already equipped approximately 12,000 artisans nationwide, including roadside mechanics, forklift operators, and various other technicians, with essential skills. This demonstrates the existing infrastructure and human capital available to support a revitalized automotive sector. The push for the Nigeria National Automotive Industry Bill 2026 is therefore seen as a critical step towards leveraging these national assets and addressing the economic vulnerabilities associated with unchecked vehicle imports.

Mrs. Taiwo Oluleye, the Managing Director of PAN Nigeria Limited, provided insights into the company's operational history and current challenges. Established in 1972 and commencing operations in 1975, PAN Nigeria Limited boasts an installed annual production capacity of 90,000 vehicles. However, the company has experienced a consistent decline in production volumes. This downturn is attributed to a combination of factors, including elevated operating costs, persistent exchange rate pressures, high borrowing expenses, and inconsistencies in government policy.

Mrs. Oluleye also detailed the significant regression in local content integration. Previously, under a more supportive policy environment, PAN had achieved an impressive 40 percent local content in its vehicles. This figure has now plummeted to below four percent. She made a direct appeal to the National Assembly for the urgent passage of the proposed legislation, stressing that local assemblers face an uphill battle competing effectively against businesses primarily focused on importing. Senator Fadahunsi echoed this sentiment, appealing directly to President Bola Ahmed Tinubu to strengthen governmental support for the automotive industry, warning that continued dependence on imported vehicles would exacerbate pressure on Nigeria's foreign exchange reserves.

The National Assembly has expressed its unwavering commitment to ensuring the swift passage of the proposed automotive industry legislation. Senator Fadahunsi explicitly pledged the legislature's cooperation, stating their intent to utilize all available powers to accelerate the bill's progression. This unified stance from both industry stakeholders and legislative leaders underscores the perceived urgency and importance of the Nigeria National Automotive Industry Bill 2026. Its successful implementation is anticipated to not only protect existing investments but also stimulate new growth, create jobs, and foster a more self-reliant automotive sector in Nigeria, ultimately contributing to broader economic stability and development.

Lawyers advising clients in Nigeria's automotive manufacturing, import, or related sectors should closely monitor the fast-tracking of the National Automotive Industry Bill 2026. Its potential passage could introduce new local content requirements, import restrictions, and investment incentives, necessitating a review of compliance strategies and supply chain operations.

Source: Reporting based on recent legislative and industry statements.