The Nigerian government introduced the Nigerian Automotive
Industry Development Plan (NAIDP) in 2013 to revitalisethe auto
industry. Last year, the policy came into full effect. PwC
developed scenarios to capture the potential effects of the policy
and identified Nigeria as a future automotive hub driven by its
large economy, population and government's intent to revive the
industry. With the policy in active existence for over a year, we
discuss the current situation in the industry.
The Economy
The current economic climate has been challenging for businesses
as the decline in global oil prices (to $40 -$50/bbl.) and
significant production shortages (from 2.2 mbpdin Q2 2015 to 1.4
mbpdin Q2 2016) has put immense pressure on government revenues and
foreign reserves. Nigeria is officially in a recession following
negative growth of -0.4% in Q1'2016 and -2.1% in Q2'2016.
Consequently, the general and automotive manufacturing industry
were worst hit with growth at
