Auto giants battle used car dealers for Africa's huge market

JOHANNESBURG/NAIROBI - At the edge of Nairobi’s Ngong Forest, thousands of used cars glitter in the hot sun on a dusty field, waiting for buyers.

Volkswagen, BMW, Toyota, Nissan and others have joined forces to lobby governments for steps that would reduce the imports that have made sub-Saharan Africa notoriously difficult terrain and allow local production to flourish. But that will require addressing the well-entrenched interests of second-hand car dealers, smugglers and lowering the price of new cars.

Nigeria and Ghana are preparing to offer automakers tax holidays of up to 10 years and duty-free imports of parts and components used in local assembly. Nigeria also plans to double the levy on new, fully-built imported vehicles to 70 percent to boost demand for locally produced cars, though the policy’s approval has been delayed.

Toyota South Africa’s chief executive Andrew Kirby said the strategy is: “Focus on Africa because Africa is going to grow significantly.” Political will is needed to change that, and without it there is little point in considering a country for local production, according to VW’s Schaefer.

Auto giants are size queens b/c they like African's huge markets.

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