Nigerians resort to ‘Naija’ used cars as ‘Tokunbo’ sales drop by 70% due to 40% hike in exchange rate for cargo clearance.
Low sales of 2nd-hand imported cars follows the implementation of the exchange rate from N422.30/dollar to N589/dollar by a PTML.
The current hike in the prices of imported vehicles popularly known as “Tokunbo” due to the recent 40 per cent hike in the exchange rate for cargo clearance at the seaports has forced many to resort to Nigerian used ones popularly called “Naija cars”.
According to reports, the implementation of the exchange rate from N422.30/dollar to N589/dollar by a terminal operator, Ports & Terminal Multipurpose Limited, has led to about 70 per cent drop in the sale of second-hand imported cars.
The NCS in a circular dated July 4, 2023, titled : ‘Implementation of the floating foreign exchange rate regime’ directed its area controllers to ensure that the information was communicated to relevant stakeholders.
The circular, signed by the Assistant Controller General, IT & Modernisation, K. I. Adeola, read in part :
“The CBN has instituted the floating exchange rate regime, which has given rise to incessant changes in the exchange rate for trade. The policy is to be implemented by all ministries, departments and agencies of the government, including the NCS.”
Confirming the development, the Youth Leader of the Association of Nigerian Licensed Customs Agents (ANLCA), at Tin Can Island, Remilekun Sikiru, said the directive has been communicated to members of the group, adding that the new rate had been effected on the Customs portal.
Sikiru, also the CEO of Siktemstar Logistics, told Punch that the customs duty payable on imported vehicles had increased astronomically.
Giving details of the new rate for clearing vehicles from 2001 to 2014, Sikiru said :
“The actual duty on Toyota Camry is N705,000, while the total duty and clearance cost is N1.7m. For Corolla, the duty is N558,000 and total clearance cost is N1.3m.
“Sienna duty is N930,000 and total clearance cost is N2.2m. Duty on Highlander is N1.1m, bringing the total clearance cost to N2.6m, while duty on Venza is N1.2m and total cost is N3m.
“For Lexus RX350, the duty is now N1.5m, bringing the total clearance cost to N3m; duty on Lexus ES350 is N1.3m and the total cost is N3m. For Toyota RAV4, the duty is N831,000 and total cost of clearing it is N1.2m.
“Honda Pilot’s duty is N966,000 and the total clearance cost is N2.2m. Honda Accord’s duty amounts to N769,000 and total clearance cost is N1.8m. For Toyota Tacoma, the duty is N417,000 and total clearance cost is N818,000. These vehicles are from 2001 to 2014.”
Total duty or total clearance cost is the duty payable on a car plus the surcharge, ECOWAS duty and the seven per cent (7%) port development levy.