By Lucy Ogalue, News Agency of Nigeria (NAN)
For decades, Nigeria’s automotive market has operated largely in the shadows; it has been fragmented, informal and often risky for both buyers and investors.
From cases of stolen vehicles to disappearing dealers and limited access to financing, stakeholders say the absence of a structured system has long undermined growth in the sector.
Recently, however, the Federal Government unveiled the National Vehicle Dealership Registration Framework, which is being seen as a potential turning point.
At the centre of the initiative is the National Automotive Design and Development Council (NADDC), which has introduced a digital platform to formally register and track vehicle dealers nationwide.
NADDC Director-General, Joseph Osanipin, provided insights during the inauguration.
He described the framework as more than a regulatory tool.
“Today is not merely an administrative milestone; it is the day we transition from planning to practice.”
He said that the platform was designed to “modernise, sanitise and revolutionise” automotive business operations in Nigeria.
Stakeholders say that Nigeria remains one of Africa’s largest markets for used vehicles, commonly known as “Tokunbo,” with imports dominating supply.
They say the absence of reliable data on dealers and transactions has created loopholes for fraud and inefficiencies.
Osanipin acknowledged these gaps, noting that the framework would provide long-needed visibility into the sector.
“It has been long overdue for us to have full data, full details, and the identity of those that are motor dealers in Nigeria,” he said.
He cited cases where buyers unknowingly purchased stolen vehicles or were unable to trace sellers after faults emerged.
The director-general said such incidents eroded consumer confidence and discouraged formal investment in the sector.
Auto industry stakeholders say one of the strongest arguments for the new framework is its potential to enhance security.
President of the Association of Motor Dealers of Nigeria (AMDON), Prince Ajibola Adedoyin, said the initiative would help address crimes linked to vehicles.
“Most times, tracing the source of vehicles used in crimes becomes very difficult.
“With this, every car can be traced to the doorstep of the source,” he said.
Analysts say improved traceability aligns with global standards, where vehicle registration systems are integrated with law enforcement databases.
According to Sarah Benjamin, an analyst, the framework can also curb the circulation of stolen and substandard vehicles.
Beyond security, Benjamin highlighted the framework’s potential to unlock financing, an area long constrained by trust deficits.
According to the NADDC boss, financial institutions have been reluctant to support vehicle purchases due to lack of verifiable dealer identity.
“Banks will not want to finance someone they will give money to and it will disappear.
“More so, a verified dealer database will give lenders more confidence to support transactions,’’ Osanipin said.
The AMDON national president agreed to this, noting that access to credit depended largely on trust and data.
“If you do not know who you are dealing with, you cannot give credit. But with proper data, credit can be facilitated easily.
“Improved access to credit can also stimulate demand, expand dealership operations and support growth in the broader automotive value chain,’’ Adedoyin said.
On the effect of the framework on local industry and AfCFTA prospects, the NADDC director-general said the framework was expected to support Nigeria’s ambition to become a regional automotive hub under the National Automotive Industry Development Plan (2023–2033).
Osanipin described the initiative as a “vehicle” for implementing the policy roadmap.
“A roadmap is useless without a vehicle. This Registration Framework is that vehicle.
“A structured, registered and data-driven dealership network is Nigeria’s strongest currency. It will strengthen Nigeria’s position under the African Continental Free Trade Area (AfCFTA),” he said.
He noted that standardisation would be critical for Nigerian dealers to compete across African markets.
At the heart of the initiative is a digital portal developed to simplify registration, reduce paperwork and improve efficiency.
Osanipin said the system would serve as a “digital birth certificate” for vehicles sold through certified dealers.
He expressed similar optimism saying. “Nigerians on their own are going to systematically take out those that are not recognised”.
Meanwhile, experts believe this could significantly reduce grey-market activities and promote accountability.
They also point to the likelihood of “self-regulation,” where consumers increasingly favour registered dealers over informal operators.
In spite of the optimism, Mr Kelvin Owoicho, an auto industry analyst, cautioned that implementation would be key to the framework’s success.
Owoicho emphasised the need for effective enforcement, public sensitisation and inter-agency collaboration.
He reiterated that awareness campaigns would be critical in driving adoption.
“It is about sensitisation; the public needs to know the benefits of buying from registered dealers.
“Although informal operators may resist the transition, especially if compliance costs are perceived as high, the long-term benefits outweigh the challenges,” he said.
Similarly, Mr Justin Ugbede, an industry stakeholder, said the inauguration of the dealership registration framework could mark a defining moment foryy Nigeria’s automotive industry.
“If effectively implemented, it can improve transparency, enhance security, unlock financing and attract investment.
“More importantly, it can shift the sector from an informal, high-risk environment to a structured and globally competitive ecosystem,” he said.
As the NADDC boss said, the goal is clear: to build “an industry that is transparent, profitable and globally competitive.”
For millions of Nigerians who rely on vehicles daily, a digital database of dealer identities and vehicle transactions, as well as other provisions of the initiative, could not come soon enough.(NANFeatures)
