ECONOMIC INSIGHT Sale of new vehicles drops by 48 percent

Not more than 7000 brand new vehicles were sold in the three quarters of 2017 by the entire auto companies in the country.

This represents a drop of 48 per cent compared to 14,500 units sold in the same period in 2016, it was learnt.

The Managing Director of Toyota Nigeria Limited (TNL), Mr. Kunle Adeojo, who gave the figure during his quarterly briefing in Lagos however disclosed that TNL’s share of the market has reached 22 per cent with the target of 24 per cent before the end of the year.

He also projected a five per cent growth for the auto industry in 2018, saying the industry has begun to witness some improvement.

He also disclosed that importation of brand new vehicles recorded slight improvement.

Adeojo said, “From the importation point of view, there is a slight improvement because in the first quarter, we had about 90 percent drop but as at the third quarter now, the drop has reduced to 62 percent.

“We imported about 2,300 as at Q3 ending and 6,100 as at Q3 of 2016. We had a drop of 62 percent in the import.”

He said the company’s performance was in the sale of Toyota Hilux which formed 60 to 70 per cent of the total sales, adding that attention would equally be given to after sale services.

He added, “As at the end of Q3 looking at performance, we have about 22 percent of the brand new car sales for the year but we are hoping that by the end of the year, to grow that to 24 percent as we are forecasting to end it at about 9,000 units of vehicles.

“The number one selling for us in Toyota is the HILUX. It contributes about 60 to 70 percent. The reason for that is the fact that at the beginning of the year, we were quite short of passenger vehicles as a result of privatization.

“The Hilux, Hiace and Avensis are the top three models”, he said, adding that there is a bright future as 2018 approaches.

“We are forecasting that the auto market will grow five per cent. I say this because of the easing that we are beginning to see. If you look at the ratio sales of vehicles, most sales were more of commercial vehicles. In 2018, we hope to see a bit of balancing with the recovery of passenger vehicles.

“This year, a lot of companies were very careful because of the economic recession. They buy vehicles that would help improve productivity of their businesses.

“As the economy improves, so will there be balancing of sales across the models and vehicle segments.

“A more realistic growth will be experienced next year.

“However, there are risks. As 2018 budget is signed into law, we might begin to see some marginal activities in businesses. As we are doing that there will be an improvement generally,” he said.