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Tokunbo car prices jump 100% compared to the tariff hike

The prices of imported used cars have spiked by 100 per cent in the last year, on the back of a tariff hike by the Nigeria Customs Service in 2022.

When our correspondent visited some of the car marts in Lagos, including Berger and Alimosho, it was observed that cars such as Toyota Corolla, Camry, and Honda Accord products were about N1m higher than their former prices before the Customs raised the import duties on used cars.

Speaking with our correspondent on Monday, a member of the United Berger Motor Dealers Association, Mr Chinonso Amariwu, said, that the 2005 model of Toyota Corolla that sold for N1.9m in 2021 was selling for N4m.

In 2021, Toyota Corolla 2005-2007 models were sold between N1.9m and N2m, depending on the grade, but the same model is now sold between N3.8m and N4m. In 2021, Honda Accord 2004 was sold for between N1.4m and N1.6m, and the 2008 model was sold for N2m. But currently, the same model of Honda Accord 2004 to 2005 goes for between N2.9m and N3.2m while the 2008 model is between N3.2m and N3.9m. Camry 2004 as of 2021 was sold for N1.7, but it is currently sold for N3.5m upwards,” he explained.

Amariwu blamed the high exchange rate and increase in the cost of clearing imported used vehicles for the high cost of imported used cars since 2022.

According to him, there is a 30 per cent decline in used car patronage.

“The high cost is affecting buying cars from overseas. There is also a low turnout of importers buying and importing used cars to Nigeria. There has been a steady drop in car purchases since 2022 unlike what the market recorded in 2021,” he declared.

Also, the Secretary General of the Lagos State Motor Dealers Association of Nigeria, Mr Tai Olaniran, urged the new administration to address the issue of exchange rates.

We are expecting the new government to address the issue of the exchange rate. The exchange rate for clearing vehicles at the ports is where we are having major challenges. So, if they can address this, it will make the business more lucrative.

Again, it will help to make the economy better. We are expecting the new government to help us talk to them in the ports because there are so many agencies in the ports and they need to reduce them so that the costs and challenges with vehicle clearance will be addressed,” he asserted.

He lamented that there was a 60 per cent drop in car sales in 2022.

“For cars like Toyota Corolla and other vehicles that are common here in Nigeria, the prices differ. There are no fixed prices; everyone sells according to how he got it. Some people can buy an accident vehicle and put a tag on it.

“The prices have gone up by like 50 per cent. Of course, it has affected the number of cars we sell in a day. Currently, I did not even go to the office and the reason is that there is nobody buying cars again,” Olaniran lamented.

The Managing Director of Zodik Freight Services, Mr Emmanuel Ngwuta, attributed the rise in the prices of imported cars to the increase in freight charges.

After the global pandemic, we had economic degradation all over the world. The impact depends on a country’s economy and its exchange rate. For example, the shipping charge from America to West African countries increased. So, if you are from a country such as Nigeria, you cannot use the world rate because the countries’ economies vary. When there is an increase in shipping rates, there is every tendency that imports into Nigeria will increase. The duty also increased because the country relies on internally generated revenue. So, when they increase the Value Added Tax, the duties will also increase,” he concluded.


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