Nigerian vehicle importers may soon face higher costs as the United States prepares to impose a 25% tariff on imported automobiles.
US President Donald Trump announced plans to implement the tariffs by April 2 as part of broader trade measures targeting automobiles, semiconductors and pharmaceuticals.
The policy is expected to impact Nigeria’s vehicle import market as most used cars in Nigeria are sourced from the United States.
Freight forwarders and industry stakeholders warn that the proposed tariff hike could affect the cost of importing vehicles into Nigeria.
“Yes, it will definitely affect vehicle importation into Nigeria because most of the cars that come into Nigeria are from the US. So if they are buying it higher, it means they will be selling it higher to Nigerians,” said Mr. Nnadi Ugochukwu, Head of the Department of Shipping and Terminals at the National Association of Government Approved Freight Forwarders.
The European Union currently imposes a 10% duty on vehicle imports, while US import tariffs on passenger cars stand at 2.5%. However, the US imposes a 25% tariff on pickup trucks, a rate that makes such vehicles highly profitable for Detroit-based automakers. Trump has long argued that US automotive exports face unfair treatment in foreign markets and is pushing for new tariffs to protect domestic manufacturers.
The European Union’s Trade Chief, Maros Sefcovic, is set to meet with US officials in Washington to discuss the proposed tariffs, as concerns grow over reciprocal trade measures from affected nations. Trump has claimed the EU is considering lowering its tariffs on US vehicles, though European lawmakers have denied making such commitments.
Trump has also indicated plans to impose sectoral tariffs on pharmaceuticals and semiconductor chips, with duties starting at 25% or higher and increasing over time. He stated that he would provide companies with time to set up US-based manufacturing facilities before the tariffs take full effect.
For Nigeria, the potential increase in import costs could have far-reaching effects on the automotive market, particularly in the sale of foreign-used vehicles, popularly known as Tokunbo cars, which dominate the sector.
Industry analysts warn that higher import duties could translate to increased vehicle prices, making cars less affordable for consumers and further straining an economy already grappling with inflation and foreign exchange challenges.
As April 2 approaches, Nigerian vehicle importers and dealers are closely monitoring developments, assessing the potential impact of the US policy shift on the country’s automobile supply chain and pricing trends.
