Ford Motor Company will start assembly of the Ford Ranger in Nigeria by the end of this year, according to a news report by Reuters. The Nigerian assembly plant in Ikeja, Lagos, in partnership with Ford's dealer Coscharis Motors Limited, is the first plant outside South Africa, where Ford produces the Ranger for 148 markets. According to Jeff Nemeth, president and CEO of Ford Motor's business in sub-Saharan Africa, "Nigeria is a priority market for us in sub-Saharan Africa. Depending on how Nigeria develops over time... we are potentially looking at using our Nigerian plant to service West Africa." He stated further that Nigeria's auto market has huge potential, but sells only a small amount of new vehicles annually. The segment is dominated by imported used vehicles, while factors such as lack of finance options and absence of an industrial policy that would encourage suppliers to set up in Nigeria have negatively affected its growth.
Significance: Ford's decision to start assembly of its best-selling Ford Ranger pickup truck in Nigeria follows the enforcement of the new National Automotive Industry Development Plan (NAIDP) by the Nigerian government in 2013. The NAIDP raised duties on imports of completely built-up (CBU) units in Nigeria sharply to 70% from 20%. This increase was intended to discourage vehicle imports in the country and encourage local production. Commenting on the benefits of setting up an assembly plant, Nemeth said, "It would take between one to two months to take an order, build it and deliver it within the country. If you order from overseas it would take between four and six months." The Ikeja plant will assemble the Ford Ranger using parts and components imported from South Africa. The plant will have the capacity to assemble up to 5,000 units annually, which will be sold in Nigeria. In July, automakers such as Volkswagen and Honda announced the start of assembly operations in Nigeria.
