Nige­ria’s mo­tor in­dus­try plan can help us — Nissan SA

Business Day - - FRONT PAGE - DAVID FUR­LONGER fur­[email protected]

NIGE­RIA will have its own mo­tor in­dus­try whether SA likes it or not, MD of Nissan SA Mike Whit­field has said. Fail­ure by SA to sup­port it will sim­ply open the door for other coun­tries to ben­e­fit from the bil­lions of rand of busi­ness that will en­sue. Mr Whit­field was re­spond­ing to doubts about the wis­dom of SA help­ing Nige­ria cre­ate an in­dus­try that could be­come a ri­val.

NIGE­RIA will have its own mo­tor in­dus­try whether SA likes it or not, says Nissan SA MD Mike Whit­field. Fail­ure by SA to sup­port it will sim­ply open the door for other coun­tries to ben­e­fit from the bil­lions of rand of busi­ness that will en­sue.

Mr Whit­field was re­spond­ing this week to doubts about the wis­dom of SA ac­tively help­ing Nige­ria to cre­ate an in­dus­try that could be­come a ri­val. For­mer SA trade and in­dus­try min­is­ter Alec Er­win has been ad­vis­ing Nige­ria on set­ting up an in­dus­try, us­ing his pre­vi­ous ex­pe­ri­ence in help­ing to mod­ernise SA’s mo­tor sec­tor.

Nige­ria’s automotive pol­icy is based on SA’s 1995-2012 mo­tor in­dus­try de­vel­op­ment pro­gramme, which Mr Er­win im­ple­mented. In an in­ter­view on Mon­day, he said the in­dus­tries would com­ple­ment each other, not com­pete.

Sev­eral multi­na­tion­als have be­gun build­ing ve­hi­cles in Nige­ria and oth­ers are wait­ing in the wings. The com­pa­nies are all as­sem­bling im­ported kits. Nige­rian of­fi­cials say they hope the in­dus­try will be­gin pro­duc­ing its own com­po­nents within two years but mo­tor com­pany ex­ec­u­tives say it is likely to be at least 10 years be­fore the in­dus­try starts to be­come self-suf­fi­cient.

Nissan SA is send­ing kits to Nige­ria. NP300 one-ton bakkies are crated in pieces at the Ross­lyn plant near Pre­to­ria then shipped to Nige­ria, where they are put to­gether. Mr Whit­field said that this year, Nissan SA ex­pected to send “rather more” than the 3,000 ve­hi­cles it shipped to Nige­ria last year.

Ross­lyn, which also pro­duces the NP200 half-ton bakkie, will build about 40,000 ve­hi­cles this year — just more than a third of its 110,000 ca­pac­ity. Mr Whit­field is ex­pected to an­nounce a plan be­fore year-end to close the gap, pos­si­bly with an ad­di­tional ve­hi­cle range.

How­ever, he said the Nige­rian op­er­a­tion would not di­min­ish Nissan SA’s ac­tiv­i­ties. The African new-ve­hi­cle mar­ket was ex­pected to grow from 1.4-mil­lion ve­hi­cles in 2014, to 2.2-mil­lion by 2020. If that hap­pened, there would be plenty of op­por­tu­nity for two Nissan plants.

Nige­ria, he said, was al­ways go­ing to get its own mo­tor sec­tor.

Though it had failed to sus­tain one in the 1980s, cir­cum­stances had changed. It was closer than SA to ma­jor African pop­u­la­tion cen­tres and its new-ve­hi­cle mar­ket was neg­li­gi­ble. An­a­lysts say that if new

SA’s in­dus­try can’t af­ford not to be there. If we and Nige­ria co-op­er­ate, we will de­velop each other

im­port du­ties re­duce Nige­ria’s thriv­ing used-car busi­ness, the mar­ket for new cars could ex­plode from 40,000 to nearly 1-mil­lion.

In many re­spects, Mr Whit­field said, Nige­ria was sim­i­lar to Brazil, which in a few years had gone from a tiny base to build­ing more than 3mil­lion ve­hi­cles an­nu­ally.

“If, over the next 10 years, the Nige­rian auto in­dus­try can achieve half as much as Brazil did over the same pe­riod, it will be do­ing very well,” he said.

The South African in­dus­try, he added, “can’t af­ford not to be there. If we’re not, some­one else will be. If we and Nige­ria co-op­er­ate, we will de­velop each other.”

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