Although high tariffs have put a significant dent in the market for imported used vehicles in Nigeria, demand still exists within the country. For the savvy importer/exporter, there is certainly money to be made in the Nigerian used auto market. This is particularly true if you’ll be exporting from the United States, due to the wide availability of used automobiles in the United States that are popular in the Nigerian used vehicle market.
All of that said, the process of getting from a used car auction in the United States to the roadways of Nigeria can be incredibly complex. All along the way, there are various things of which you’ll need to be aware. Below, we’re going to review everything that you need to know about importing used and salvage vehicles from the United States to Nigeria.
Buying a Used or Salvage Car at a U.S. Auction
The process of importing a used or salvage vehicle from the United States begins, of course, with purchasing such a vehicle. There are a number of ways you can go about this, most notably through online U.S. used car auctions.
Online used car auctions offer a number of different advantages for someone importing vehicles into Nigeria. For one, these auctions offer one the chance to save as much as 70 or 80 percent on a used or salvage car’s value. In addition, online used car auction sites offer access to an incredible array of vehicles, ensuring that you’ll be able to find the one (or ones) that meet your criteria.
Getting started with online U.S. used car auctions is incredibly simple too! To start, you’ll need to make a deposit that establishes your bidding power. For the most part, this deposit will be equivalent to 10% of your total bidding power. For example, were you to make a deposit of only $300, you would be entitled to bid up to a maximum amount of $3,000 on any used or salvage vehicle.
Once you’ve made your deposit, it’s all about the search. You’ll find that any online car auction site has an incredible inventory of vehicles. As you search, be sure that you’re paying close attention to things like insurance repair estimates and vehicle history reports. Should you have any questions, doubts or concerns, simply get in touch with the auction agent who’s been assigned to you.
Remember also that these sites are not permitted to publically display the full inventory of auctions and vehicles to which they have access. That doesn’t mean that you can’t look into these options, though. You simply need to get in touch with your auction agent, let them know what you’re looking for, and then he or she can scan their private databases, finding auctions and vehicles that might be just what you’re looking for.
As for the bidding part, you can participate directly or have the agent bid on your behalf after establishing a maximum bid. Should your bid be successful, you will then be required to pay the full bid amount of the car – minus the money you’ve already deposited, of course. After that, it’s all about arranging shipping, getting through customs, and importing your U.S. used car into Nigeria!
Arranging for Shipment to Nigeria
When shipping your U.S. used car to Nigeria, you will have the option of choosing between two different shipping methods. The first is traditional container shipping, and the second is something called “roll-on roll-off” shipping, which is known more commonly as RORO shipping.
RORO shipping offers a number of advantages and a number of disadvantages, as well. On the plus side, RORO shipping is generally much cheaper than traditional container shipping, and it’s more convenient in terms of loading and unloading your vehicle. However, there are safety concerns. For one, your car may need to be moved during shipping, and it will also be exposed to the elements and rough seas. This could lead to damage.
If you’re interested in RORO shipping to Nigeria, the following ports in the United States generally offer such service:
- Baltimore, Maryland
- Bayonne, New Jersey
- Galveston, Texas
- Jacksonville, Florida
- Portsmouth, Virginia
- Savannah, Georgia
If you’re going to go the traditional container-shipping route – either by choice or because the vehicle you’re shipping cannot “roll-on roll-off” – the following ports in the United States offer such service to Nigeria:
- Houston, Texas
- Long Beach, California
- Miami, Florida
- Newark, New Jersey
- Oakland, California
- Savannah, Georgia
There are two arrival ports in Nigeria for used vehicles:
- The Lagos Port Complex
- The Tin Can Island Port Complex
While both ports offer service to container ships, only the Tin Can Island Port is available as an arrival destination for used cars shipping via the RORO method. The Lagos Port Complex is among the busiest in all of Africa, and is based in the economic heart of the country, Apapa.
For more information about both The Lagos Port Complex and the Tin Can Island Port Complex, you can consult the Nigerian Ports Authority.
Getting Your Used or Salvage Car Through U.S. Customs
After you’ve determined the port through which you’ll be shipping your used vehicle to Nigeria, the vehicle will need to be presented to U.S. Customs at that port. When presenting the vehicle, you will need to present the appropriate documents that establish and verify the car’s Vehicle Identification Number (VIN) or Product Identification Number (PIN). This will almost always be the vehicle’s Certificate of Title or a Salvage Title.
Regardless of what kind of title you’re presenting, you’ll need multiple copies. You can either present the original Certificate of Title along with two complete copies, or you can present the original Certificate of Title along with a Certified Copy. The copies must be submitted with U.S. Customs at your departure port no less than 72 hours in advance of the ship date.
At the port, the vehicle will also need to be inspected. To find out precisely where you’ll need to go in order to present documentation and have the vehicle inspected, you should contact the Port Director at your departure port.
Should you have further questions about the process of getting your used vehicle through U.S. Customs, you can consult this overview. In addition to covering the above, this overview also reviews the process for vehicles with foreign titles and vehicles without titles.
Getting Your Used or Salvage Car Through Nigerian Customs
There are two major restrictions that should be of concern to those importing used vehicles from the United States into Nigeria. One, used vehicles imported into Nigeria must be no older than 15 years from their date of manufacture. Further, right-hand drive vehicles cannot be imported into the country.
Beyond these major restrictions, you should also know that the process for getting an imported used car cleared through Nigerian customs is incredibly complex, requiring numerous documents to be filed with the relevant authorities. To read about this process and the documents required, you can consult this guide that was put together by the Bank of Niger.
Given the complexity, you may wish to work with a customs broker or shipping agent to ensure that your used vehicle clears customs in Nigeria. Of course, you’ll also need to factor in the cost of using such a service, which typically ranges between $1,000 and $2,000.
Import Duties and Sales Tax for U.S. Vehicles Imported in Nigeria
In recent years, the Nigerian government has undertaken steps to protect its fledgling automotive market, leading to the imposition of heavy duties on imported used automobiles. Currently, there is a 70% duty imposed on Fully Built Units (FBUs) and a 35% duty imposed on buses. This is a striking increase from the 20% duty on both that had previously been the standard. In addition to the above, there is also a 5% Value Added Tax (VAT).
From Completely Knocked Down (CKD) parts, there is currently no tariff imposed on imports. For Semi Knocked Down (SKD) parts, the tariff currently varies from five to 10 percent.
Registering Your Imported Car in Nigeria
When you’re going to register your imported used vehicle in Nigeria, you’ll first need to gather a number of important documents. These include:
- Your Nigerian Driver’s License
- Identification (Either a Passport or a National ID Card)
- Proof of Your Address
- Proof of Insurance
- Chassis Number
- Engine Number
- Customs Paperwork
With the above documents in hand, you will need to visit a local State Board of Internal Revenue / Motor Licensing Authority (SBIR/MLA) office. There, you will need to fill out a Plate Number Form, which you will then submit with the paperwork outlined above. In addition, you will also need to pay for your plate number. The cost of registration varies from state to state and depends upon the kind of vehicle you’re registering.
After you’ve taken care of the above, a Vehicle Inspection Officer will then examine your imported used car, ensuring that it is roadworthy. Provided that it passes the inspection, you’ll then be provided with the following documents:
- Roadworthiness Certificate
- Vehicle Identification Tag (VIT)
- Proof of Ownership Certificate
With those documents in hand, your paperwork filed, and your registration paid for, you will be issued a license plate. However, you’re not done yet, as your documents will need to be verified by the Federal Road Safety Commission (FRSC).
To get verified, simply visit a local FRSC office with the following documents in hand:
- Passport or National ID
- Certificate of Entry
- Terminal Delivery Order
- Receipt of Purchase
- Payment Schedule
- Engine Number
- Chassis Number
- Vehicle Releasing Invoice
Provided everything checks out, the above will be verified and your used car will be officially registered in Nigeria.
The Used Car Market in Nigeria
Low-income residents in Nigeria can find it near impossible to secure auto financing from their banks. As a result, many of these individuals turn to the used car market in order to purchase a vehicle. Overall, this has led to an upward trend in the used car market in Nigeria that shows absolutely no sign of slowing down.
The majority of used automobiles imported into Nigeria originate in the United States. In fact, the last time statistics were compiled, it was found that the United States owns a 70-percent market share of the Nigerian used car market. This market domination for the United States also carries over into the market for remanufactured and used parts, which is currently valued at around $100 million.
Problems in the Nigerian Used Car Market
Needless to say, the high tariffs that have been imposed on vehicles entering Nigerian ports have had an adverse effect on exporters and importers alike. These tariffs have also created other problems that make the market much trickier than it would otherwise be.
For one, the prohibitively high tariffs have opened the door to corruption among government officials and those dealing in import markets. In fact, a “grey” market for used cars has grown as a result of the high tariffs, with vehicles now being smuggled into the country over land from Togo and Benin, two countries that neighbor Nigeria to the west. Competition from these smuggled vehicles has led to a depreciation of used car values in Nigeria.
Most Popular and Least Popular Used Car Makes in Nigeria
Fuel efficiency is seen as a major selling point in the Nigerian used car market. As a result, Japanese brands have become incredibly popular, with Toyota leading the way in terms of popularity. Aside from fuel efficiency, there’s a key reason that Toyotas are popular with Nigerians that’s worth understanding. Spare parts for Toyotas are readily available in most places, leading to repair costs that are not prohibitively expensive.
The availability of spare parts, in fact, is what determines the least popular makes in Nigeria. Volkswagen automobiles are particularly undesirable, due both to the scarcity of spare parts and also to the expense of those parts.
Aside from fuel efficiency and the availability of spare parts, there’s one other factor that’s often foremost in the mind of a Nigerian used car buyer. Whatever vehicles they purchase need to be able to handle roadways that are often in a state of disrepair and other difficult terrain. For this reason, vehicles that are seen as durable and comfortable are quite desirable. In fact, this has created a nascent market for Sport Utility Vehicles (SUVs) made in the United States and elsewhere.