AvtoVAZ Targets Nigerian Market: Plans for Local Assembly and CNG Vehicles

AvtoVAZ, Russia’s largest automaker, is planning to enter the Nigerian market by establishing a car assembly plant, spare parts hub, and service center. This initiative aims to provide affordable, locally assembled vehicles and reduce import dependency. The automaker also plans to implement a compressed natural gas conversion plant, aligning with Nigeria’s automotive development strategy.

AvtoVAZ, Russia’s largest automaker, is set to make a significant entry into the Nigerian automobile market by establishing a car assembly plant, spare parts hub, and service center. This strategic move aims to offer affordable, locally assembled vehicles to compete against used imports and other new models. The focus on Nigeria, one of the largest automotive markets in Africa, is driven by its burgeoning population and urbanization.

The establishment of AvtoVAZ’s operations in Nigeria also aligns with the country’s National Automotive Industry Development Plan. This initiative aims to reduce dependency on vehicle imports while fostering local production. Additionally, the automaker’s plans include a spare parts hub and service center in Lagos, anticipated to launch by the end of 2025, solidifying its presence in West Africa’s largest economy.

As part of its broader strategy to diversify operations amidst geopolitical challenges, AvtoVAZ is expanding its footprint in Africa, with a particular emphasis on Nigeria. The company already aims to export approximately 20,000 vehicles in 2023, focusing on opportunities in emerging markets. This expansion also includes plans for a compressed natural gas (CNG) conversion plant, which intends to align with Nigeria’s growing interest in alternative fuel vehicles.

In this context, Adewole Opeyemi, AvtoVAZ’s representative in Nigeria, expressed optimism about the CNG initiative, noting, “If you bring CNG cars to Nigeria, you don’t pay any duties, which is why we are in talks with the relevant agencies.” He further elaborated that certain Lada models will come with factory-fitted gas engines, while others can be converted locally.

Africa significantly contributes to the global used vehicle market, accounting for around 40% of imported transactions. Key markets such as Nigeria, Libya, and Kenya highlight this trend, with used vehicles composing 85% of the continent’s total fleet. In Nigeria, approximately 70% of car sales are attributed to used vehicles, largely due to their affordability. Nevertheless, the rise of local automakers is beginning to shift this narrative, offering more options for new car purchases.

AvtoVAZ’s strategic entry into Nigeria represents a significant step in expanding the automaker’s influence in Africa amidst a growing demand for locally assembled vehicles. By aligning its operations with Nigeria’s development plans, AvtoVAZ aims to reduce reliance on imported vehicles and promote local manufacturing. The prospects of establishing a CNG conversion plant further enhance the company’s commitment to tapping into alternative fuel markets. Overall, this initiative positions AvtoVAZ to effectively compete within Nigeria’s vibrant automotive landscape.

Original Source: africa.businessinsider.com