A Global Marketplace
The Growing Need for Imports in Nigeria
Published March 10, 2020 - Written by Dan Oscarson
3 min read
Mexico imports more vehicles from IAA than any other country. Who buys the second-largest number of vehicles? Nigeria. Of all the countries on this planet, why Nigeria?
It’s easy to understand why Mexico imports more vehicles from IAA than any other country. Transportation costs are lower, given the proximity to our border, and dealers and consumers can find replacement parts easily. With a rising middle class and consumers looking for value, our product stays in constant demand.
Who buys the second-largest number of vehicles? Nigeria. Of all the countries on this planet, why Nigeria?
Nigeria is home to approximately 200 million people, which is roughly 60% of the U.S. population. In urban areas such as Lagos, the port city with more than 21 million residents, people without vehicles rely on a loosely operated bus system or walking to move about. The current motorization rate in Nigeria is a ratio of 64-to-1,000, meaning there are only 64 vehicles for every 1,000 people. Looking at this in reverse, for every car in Nigeria, there are 936 people who don’t have one. Simply put, Nigeria needs more vehicles.
Last year, Nigeria imported approximately 500,000 vehicles with a new to used ratio of 1-to-131. Nigerians recognize the value of used cars – especially from the United States – because they know they’re acquiring quality vehicles that can be used, or repaired and used, for many years to come.
Nigeria’s economy has been growing the last several years. Gross domestic product grew 1.9% last year. A growing number of people are now able to obtain secondhand cars and vehicles from IAA and are meeting this market demand. Savvy buyers purchase repairable vehicles online from IAA and ship them to Nigeria, where the cost of parts and repair is far less than in the United States. Even with the cost of transportation, shipping, duty and repair expenses, buyers can repair vehicles and offer them to consumers at prices they can afford – all while making a tidy profit.
Cars from IAA are in high demand for many reasons, but two stand out:
Buyers trust cars from IAA. They appreciate our transparency. We provide the most extensive information and high-resolution images on the vehicles we sell. They love IAA 360 View® and our running engine videos. They value our customer support services and our commitment to them (in-country visits, for example).
Vehicles built to U.S. specifications typically include more accessories, safety features and upgrades than vehicles equipped for other foreign markets. The greatest evidence of this high demand is apparent on any street, where you can readily see repaired vehicles that have come from the U.S.
IAA held buyer seminars in Lagos, Nigeria, and Accra, Ghana, last month to promote the IAA brand, strengthen our buyer base and recruit new buyers. Nearly 600 people attended our meetings and buyer optimism is incredibly strong. After meeting and speaking with hundreds of people in this region, it’s clear that IAA is the preferred auction for many of these hardworking entrepreneurs.
Looking ahead, IAA’s strategic focus will continue to nurture Nigeria and the broader West African markets with our social media presence, in-country seminars and strategic relationships with market alliance partners who help attract new bidders and provide local assistance with bidding, payment, transportation, shipping and customs clearance services.
Sources: Trading Economics, Nairametrics, Nigeria Bureau of Statistics, World Bank, African Development Bank Group
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