Tyre Import into Nigeria Digs Hole in National Purse – MD, DN Tyre
- By Abimbola Tooki
- Published October 31st, 2011
- News
- Unrated
Though the Nigerian tyre market is worth some N100 billion annually, the country earns just about N10 billion from the industry, while N90 billion is lost to foreign tyre companies.
If Nigerian companies were still manufacturing tyres, at least some N65 billion out of the N100 billion would be retained locally.
The N10 billion earned from the tyre market is largely through export duties. The current import tariff regime on tyres is 10 percent for truck tyres and 40 percent for car tyres but almost all of the tyres imported are declared as truck tyres at the ports, thus fetching just 10 percent in duties, Daily Trust further learnt. Based on this, just about 10 percent (N10 billion) is earned on the N100 billion foreign import tyre market in Nigeria.
The managing director, DN Tyre & Rubber Plc, Dr. Mohammed Jimoh Yinusa, recently said almost all the tyres imported into Nigeria are tagged truck tyres to attract lower duties. He also said that when DN Tyre & Rubber Plc and Michelin were manufacturing tyres locally, they controlled 65 percent of the tyre market and imports 35 percent.
Thus, if the companies had not folded up due to harsh manufacturing conditions in Nigeria, both companies would have been retaining some N65 billion in Nigeria out of the N100 billion tyre market now.
“Currently, the tariff structure is that truck tyres attract 10 percent duty while car tyres attract 40 percent.
But Nigerians bring in all types of tyres and declare them truck tyres. We are telling the government the dichotomy doesn’t make sense, it should be flat tariff structure because of the reality of our environment,” he said. He said DN Tyre and Rubber Plc is still excited about resuming tyre manufacturing in Nigeria if the government creates the right environment.
He said: “Our hope of manufacturing again is very strong and that is why we haven’t given up. We are still keeping our manufacturing facilities so we can manufacture again. We believe that our government means well and with the understanding that we need to create jobs.
If Nigerian companies were still manufacturing tyres, at least some N65 billion out of the N100 billion would be retained locally.
The N10 billion earned from the tyre market is largely through export duties. The current import tariff regime on tyres is 10 percent for truck tyres and 40 percent for car tyres but almost all of the tyres imported are declared as truck tyres at the ports, thus fetching just 10 percent in duties, Daily Trust further learnt. Based on this, just about 10 percent (N10 billion) is earned on the N100 billion foreign import tyre market in Nigeria.
The managing director, DN Tyre & Rubber Plc, Dr. Mohammed Jimoh Yinusa, recently said almost all the tyres imported into Nigeria are tagged truck tyres to attract lower duties. He also said that when DN Tyre & Rubber Plc and Michelin were manufacturing tyres locally, they controlled 65 percent of the tyre market and imports 35 percent.
Thus, if the companies had not folded up due to harsh manufacturing conditions in Nigeria, both companies would have been retaining some N65 billion in Nigeria out of the N100 billion tyre market now.
“Currently, the tariff structure is that truck tyres attract 10 percent duty while car tyres attract 40 percent.
But Nigerians bring in all types of tyres and declare them truck tyres. We are telling the government the dichotomy doesn’t make sense, it should be flat tariff structure because of the reality of our environment,” he said. He said DN Tyre and Rubber Plc is still excited about resuming tyre manufacturing in Nigeria if the government creates the right environment.
He said: “Our hope of manufacturing again is very strong and that is why we haven’t given up. We are still keeping our manufacturing facilities so we can manufacture again. We believe that our government means well and with the understanding that we need to create jobs.
