Confusion over Customs’ clampdown on auto dealers

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Anxiety over prices of vehicles as $8 billion market threatened

The nation’s automobile industry is currently in the grip of confusion as the Nigeria Customs Service (NCS) begins a major clampdown on car dealers in search of smuggled vehicles. The NCS has begun the clampdown on car marts across the country, particularly in Lagos, Katsina, Kaduna and Sokoto states.

Some of the dealers, who spoke with The Guardian were worried that their businesses had been halted for some days, without any hope in sight, claiming that the Customs were not ready to listen to them as they were only advised to wait for further directive from the headquarters.

Car dealers are alarmed that the nation’s $8 billion automobile industry is being seriously threatened by the action of the NCS. They are afraid of the possible rise in the prices of automobiles in the domestic market. The Guardian’s investigations revealed that many car dealers around Ikeja, Obanikoro, Surulere, Iyana Ipaja, Mile Two, and Igando, all in Lagos; and Sango, Ota, and Ibafo in Ogun State, among others, have moved their vehicles away from their marts in fear of possible raid by the Customs. A few courageous dealers are taking advantage of the situation to hike prices as competition shrinks.

The Spokesman of the NCS Deputy Comptroller Joseph Attah told The Guardian that the move against smuggled vehicles was a nationwide action. He said the agency had the right to shut the premises of anyone found to be dealing in smuggled goods, as stipulated in the law guiding its operations.

“The customs is performing its official duty, and that is the action we are taking across the country now. The management will review the situation and take appropriate action before weekend, and I will duly communicate that. When we sort the vehicles, we will release the ones that have duty,” Attah said.

The Federal Government had banned the importation of vehicles through land borders and slammed a 70 per cent duty on those imported through the seaports. Smuggling, grey import of second-hand vehicles, and lack of reliable data make the exact size of Nigeria’s vehicle market and fleet difficult to determine, even as Vice President Yemi Osinbajo had earlier estimated that Nigerians spent about $8 billion yearly on the importation of vehicles. “About $8 billion goes to overseas for the importation of vehicles while Nigerians are suffering. Also, most of the used vehicles imported are unsafe and not good for the citizens,” Osinbajo said.

The, in a statistical report released in August 2019, estimated the total market size of Nigeria’s automobile industry at $1.32 billion in 2019.

The country’s current vehicle size is estimated to be 11.7 million, but due to insufficient domestic production, Nigeria is highly dependent on imports to meet local demand. Anxiety now grips automobile dealers across the country not only due to the clampdown by Customs officers, but the planned review of the nation’s auto policy by the Federal Government as well as the overhaul of the sector to boost revenue generation.

The seal, sighted by The Guardian, reads: “The official seal is by Nigeria Customs Service, Headquarters Strike Force. Unauthorized removal of this seal attracts a fine of N100 million or 10 years imprisonment or both.” Other vehicle dealers across the country expressed the fear that they might be affected too.

The President of the United Berger Motor Dealers Association in Lagos Metche Nadiekwe, said it would be unfair for the customs to seal the businesses of car dealers who operated legitimately and paid duties on imported vehicles.

Meanwhile, the NCS has disclosed that in the last few days, it arrested 146 illegal migrants and seized 18,759 bags of foreign rice along the borders. The Customs, which said some of the illegal migrants were coming into the country to engage in criminal activities such as armed banditry and kidnapping, lamented that one of them was caught with a pistol.

Source: Guardian NG

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