Car sales in Africa’s most populous nation are seen by economists as a proxy for measuring private purchasing power, a leading economic indicator which is publicly unavailable in the country.
Nigerian port figures showed new vehicle imports in the first quarter tumbled 55 percent to 7,893 units, according to Navin Chander, general manager for the local unit of trading company CFAO, the sole Nigerian importer of Chevrolet cars and vans.
Industry officials said car demand in sub-Saharan Africa’s second biggest economy was likely to remain bleak for the rest of the year with credit tight for Nigerian customers.
“Our orders have come down … Businesses are not asking for vehicles while individuals are reluctant to invest in new cars,” said Wilson Anumudu, one of the dealers in Nigeria for Toyota Motor Corp which controls 40 percent of the domestic car market.
Getting credit flowing freely again in Africa’s biggest energy producer has been the country’s top priority after last year’s $4 billion central bank bailout of nine of its weakest lenders shook confidence and tightened lending.
Industry sources say that in 2008, credit sales accounted for about 22 percent of all automobile sales, but now almost all cars are being bought with cash.
“If you annualize our performance in the first quarter, you will see it’s a very far cry from 2008,” one vehicle importer who did not want to be named told a Reuters reporter.
The central bank has left its benchmark interest rate on hold at 6 percent since last July to try encourage banks to grow their loan books, but the impact has been limited.
Culled:af.reuters.com
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