Market Overview
Demand
The Nigerian import market for used cars has been weakened by government policy aimed at protecting Nigeria’s domestic automobile industry. Nigeria is estimated to import more than half a million cars every year, with nine-tenths of those vehicles second-hand imports otherwise known locally as tokunbo. (1) The implementation of the 35 percent import levy on used cars began on June 30, 2015, after several delays in implementation of the new rules. It also announced a zero percent tariff on Completely Knocked Down units (vehicles) and five percent to 10 percent on Semi Knocked Down units. Almost all cars in the country are imported. Around 150,000 used and 50,000 new vehicles in Nigeria are imported yearly. (2)
Makes/Models in Demand
According to the Blog Best Selling Cars, “Toyota remains by far the most popular carmaker in the country despite sales down 14% to 15.802 for a 29.3% market share, followed by the two main Korean manufacturers, with Hyundai shoots up 72% to 2nd place overall with 12.4% share whereas Kia is down 26% to 4.745. Nissan is up 29%. Ford is down 2% to fifth place in market share while, and Mitsubishi is down 30% to sixth place. (3)
Pros
- The leading African power in terms of GDP and the country with the largest population in Africa (162 million)
- The popularity of makes and models available in the United States market.
Cons
- High protective duties and tariffs.
- A negative impact on the business climate from insecurity and corruption (4)
- Competition from used cars smuggled from Benin and Togo in order to avoid tariffs. (5)
6 RORO Departure Ports Serving Nigeria
- Galveston, TX (arrives in Apapa)
- Jacksonville, FL
- Savannah, GA
- Portsmouth, VA
- Bayonne, NJ
- Baltimore, MD
Container Shipping Departure Ports (Shared and Full Containers)
- Oakland, CA (Shared & Full)
- Long Beach, CA (Shared & Full)
- Houston, TX (Shared & Full)
- Miami, FL (Full)
- Savannah, GA (Full)
- Newark. NJ (Full)
Arrival Ports
Arrival Port (RORO Ships)
- Tin Can Island, Lagos, NG
Arrival Ports (Container Ships)
- Apapa, Lagos, Nigeria
Documentation Requirements
- A clear Title of Ownership is required signed over to the new owner. Required to clear United States customs and enter Nigeria.
Other Requirements
- Used cars must be less than fifteen years old.
Other Import Procedures
Additional import procedures for Nigeria.
Import Duties and Taxes
Overview
Import duty and taxes are due when importing goods into Nigeria. The valuation method is CIF, which means that the import duty and taxes payable are calculated on the complete shipping value, which includes the cost of the imported goods, the cost of freight, and the cost of insurance.
Duty Rates
Automotive levy is charged at 35% on the sum of the CIF value and duty. 35%
Sales Tax
VAT is levied on imports at a standard rate of 5% on the sum of the CIF value, duty, and excise and other taxes if applicable.
Local Customs office and contacts
More information on import declaration procedures and import restrictions can be found at Nigeria Customs Service.
For US-based exporters, contact the Nigerian Embassy in Washington, DC for the latest import tax information.
Embassy of Nigeria
3519 International Ct NW
Washington, DC 20008
(2020 986-8400)
For Nigeria based importers, contact the Nigeria Customs Service:
Nigeria Customs Service Headquarters
Tel: 09 5234694
[email protected]
Market Guides For Additional Countries.
Explore our Car Auctions, Buying With Us and International Shipping Rates.
References
(1) http://www.forbes.com/sites/riskmap/2015/05/06/nigeria-seeks-to-rev-up-car-manufacturing/
(2) http://venturesafrica.com/35-import-levy-on-used-vehicles-in-nigeria-will-kick-off-in-july/
(3) http://bestsellingcarsblog.com/category/nigeria/
(4) http://www.coface.com/Economic-Studies-and-Country-Risks/Nigeria
(5) http://www.bbc.com/news/business-29061377
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