One of the oldest conglomerates in Nigeria, AG Leventis Plc has started the assembling of Volkswagen (VW) trucks in Ibadan, Oyo State.
This move is a boost by Nigeria’s National Automotive Policy, which is aimed at encouraging local manufacturing of automobiles by offering protection/incentives to potential and existing local investors, while at the same time discouraging importation.
No fewer than 54 licenses have so far been issued by the National Automotive Design and Development Council (NADDC) for local assembly of vehicles, with the firms having installed the capacity of 410,000 vehicles.
A statement made available to the public, the company’s Chief Operating Officer (COO), Sunday Asade, confirmed the development and announced that the assembly plant is situated at Moniya, Ibadan.
According to Asade, the assembly plant is owned and operated by Leventis while being put together with the specification of VW.
“Now that we have the assembly plant, people who are assembling the vehicles are trained by our partners from VW Brazil. The technical capability they have is very high. The cost of maintenance is very low because the vehicles are assembled here.”
How the assembling may influence the Nigerian economy
Following the establishment of AG Leventis Plc’s assembly plant of vehicles, the automobile industry in Nigeria is expected to boost the country’s economic development.
Spare parts manufacturing will also be an avenue where people can trade. Mobile automotive manufacturers will now focus more of their strength on locally manufactured seats, wheel covers, brake pads/linings amongst other ancillary parts.
Used auto-parts trade will also receive a boost. The growing activity in the used parts trade has led to the emergence of a highly competitive environment. Ladipo market is the major centre for used auto parts trade in Lagos and supplies the rest of the country. The market is known for being the largest spare parts destination south of the Sahara. In fact, it is the biggest in terms of size and available varieties of car accessories in the whole of Nigeria.
In its half-year 2018 financial results, AG Leventis revenue increased from N6.55 billion in 2017 to N6.91 billion in 2018. However, the company’s witnessed a spike in loss before tax of N802 million in 2018, compared to a loss before tax of N726 million in 2017.