Nigeria’s automotive industry is urging the federal government to explore the option of electric vehicles (EVs) as a way to reduce the country’s dependence on fossil fuels and achieve its climate goals. According to auto experts who spoke with The PUNCH, Nigeria’s automotive landscape is ripe for EVs, advocating for the realisation of the government’s ambitious plan to achieve a 30 per cent market share of electric passenger vehicles by 2025.
The Nigerian government, in May, had removed fuel subsidies, leading to petrol pump price rising to about N617 per litre. The jump in fuel price had prompted the FG to start giving attention to Compressed Natural Gas (CNG) vehicles due to economic concerns. In August, President Bola Tinubu established the Presidential Compressed Natural Gas Initiative targeting over 11,500 new CNG-enabled vehicles and 55,000 CNG conversion kits for existing PMS-dependent vehicles.
However, auto operators argue that CNG vehicles are not enough to address the environmental and social challenges posed by the transportation sector. They point out that EVs offer compelling benefits, including a 70 per cent reduction in maintenance costs compared to traditional internal combustion engines (ICEs). They also cite the growing cost of fuel as a significant factor that affects the average Nigerian household’s monthly budget.
Record Sales of EVs in December 2021
Despite the current focus of the FG on CNG vehicles, Nigeria’s EV market has witnessed a significant surge in sales in December 2021. A new analysis by JMK Research & Analytics revealed that overall EV sales are increasing, with 50,866 units sold in December 2021, representing a month-on-month rise of 21 per cent from 42,055 vehicles sold in November and a year-on-year gain of 240 per cent. The analysis mentioned that in India, less than 15,000 vehicles were sold at the same time a year ago in December 2020.
The analysis also showed that Uttar Pradesh continues to have the highest monthly registered EV sales among all states and Union Territories, accounting for 23 per cent of overall sales in India in December last year, with over 10,000 units sold, making it the first state to do so. Maharashtra has the second-highest sales, with 13 per cent, followed by Karnataka (9 per cent), Rajasthan (8 per cent), Delhi (7 per cent), and Tamil Nadu (7 per cent).
The majority of the EV sales were driven by electric two-wheelers and passenger three-wheelers, which made up over 90 per cent of the total sales. Two-wheelers alone accounted for 48.6 per cent of all sales, almost half of the total. Electric cars made up only 5 per cent of the total, while electric cargo three-wheelers made up only 4.3 per cent of the total. This clearly demonstrates the scarcity of affordable electric vehicle options for four-wheelers in Nigeria.
Nigeria’s First Locally Manufactured Electric Vehicle
Nigeria’s first locally manufactured electric vehicle, Kona was unveiled in 2021 by Stallion Motors Limited. The Kona is a compact SUV that can run up to 482 km on a single charge and has a top speed of 185 km/h. The Kona also features a smart key that allows remote access and control of the vehicle.
The Kona was launched with a price tag of N24 million, which is considered high by many Nigerians. However, Stallion Motors Limited has assured that the price will come down as more units are produced and sold. The company also said that it plans to introduce more models of EVs in the future.
The National Automotive Design and Development Council (NADDC) has also developed an EV Development Plan to position Nigeria as a leading country in vehicle electrification as it works towards achieving net-zero emissions by 2060. The NADDC has partnered with various stakeholders, including universities, research institutes, manufacturers, and investors to promote and support the development and adoption of EVs in Nigeria.
Challenges and Opportunities for EVs in Nigeria
Despite the potential benefits and opportunities of EVs in Nigeria, there are still some challenges that need to be addressed before they can become mainstream. Some of these challenges include:
- Lack of adequate charging infrastructure: Nigeria has a low electrification rate and frequent power outages that make charging EVs difficult and unreliable. There is also a need for more public and private charging stations across the country to cater to the growing demand for EVs.
- High cost of acquisition and maintenance: EVs are still expensive compared to ICEs due to the high cost of batteries and other components. There is also a lack of skilled technicians and spare parts for EVs in Nigeria, which makes maintenance and repairs costly and time-consuming.
- Low consumer awareness and acceptance: Many Nigerians are still unaware of the benefits and features of EVs, and some are sceptical about their performance and reliability. There is also a need for more education and sensitisation campaigns to inform and persuade potential customers about the advantages of EVs over ICEs.
- Policy and regulatory barriers: Nigeria does not have a clear and consistent policy framework for EVs, which creates uncertainty and confusion for both manufacturers and consumers. There is also a need for more incentives and subsidies to encourage the production and purchase of EVs in Nigeria.
To overcome these challenges, auto operators urge the FG to explore the option of EVs as a viable and sustainable alternative to fossil fuels. They also call for more collaboration and coordination among all stakeholders, including the government, the private sector, the civil society, and the academia, to create an enabling environment for EVs in Nigeria.