Pecohub The Federal Government has unveiled plans to formalize Nigeria’s largely informal vehicle recycling market, targeting annual revenues of over N150 billion from 2026, as part of comprehensive reforms to modernize the automotive sector.
The National Automotive Design and Development Council, NADDC, disclosed that the initiative will be driven by an End-of-Life Vehicle, ELV, program, designed to transform old vehicles from environmental and safety burdens into economic opportunities.
Under the policy, a modest fee at vehicle registration will fund environmentally sound disposal and recycling, following models in developed countries. NADDC studies show that over 85 per cent of components from end-of-life vehicles remain reusable or recyclable, forming a strong basis for a circular economy.
The program is expected to generate thousands of jobs across dismantling, refurbishing, logistics, and component resale.
The move comes amid a resurgence in Nigeria’s vehicle import market, with passenger car imports rising to about N1.01 trillion in the first nine months of 2025. To curb the influx of rusted or unroadworthy vehicles, mandatory pre-export certification for all used car imports will be introduced from 2026, with costs borne by exporters.
In parallel, NADDC plans to promote electric vehicle, EV, and Compressed Natural Gas, CNG, adoption through training, certification, and local capacity-building programs. National Occupational Standards for EV maintenance and CNG retrofitting are being developed, alongside collaborations with universities and private partners to advance local vehicle design, including buses, tricycles, and campus shuttles.
The council emphasizes that local component manufacturing—tyres, batteries, filters, and brake pads—represents the sector’s key value driver. Stakeholders are being engaged to address financing, infrastructure, and policy challenges, positioning Nigeria to benefit from the African Continental Free Trade Area.
To strengthen regulatory backing, NADDC intends to convert the National Automotive Industry Development Plan into law through a forthcoming Auto Industry Bill. Director-General Joseph Osanipin described 2026 as a pivotal year for Nigeria’s automotive transformation and called for public support to ensure successful implementation of the reforms.
