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Industrialising Nigeria through auto industry

Industrialising Nigeria through auto industry

The automotive industry is celebrated across the world as one of the most important industries. In 2017 alone, the world association of car manufacturers, Organisation Internationale des Constructeurs d’Automobiles (OICA) revealed that about 73.4 million cars and 23.84 million trucks were produced in the world. These vehicles are essential to the global economy and to the wellbeing of the world’s citizens. The average yearly turnover of the world automobile industry for 2017 was more than 2.75 trillion, which corresponds to 3.65 per cent of world Gross Domestic Product (GDP). If the sector were to be a country, its current level of GDP would be the sixth largest economy in the world.

In terms of job creation and multiplier effects on related sectors, OICA statistics showed that building 60 million vehicles would require the employment of about 9 million people directly in making the vehicles and the parts that go into them. The figure is about five per cent of the world’s total manufacturing employment. Indeed, it has been estimated that each direct automotive job supports at least another five indirect jobs in the community, resulting in more than 50 million jobs traceable to the industry. Activities in the sector are also elixirs for related sectors such as steel, iron, aluminum, glass, plastics, glass, carpeting, textiles, computer chips, rubber and the like.

In the United States, industry statistics show that the sector contributes 3.5 per cent to the overall GDP. The sector hires over 1.7 million people directly in designing, engineering, manufacturing, and supplying parts and components to assemble, sell and service new motor vehicles. The sector is estimated to spend $18 billion every year on research and product development – 99 per cent of which is funded by the industry itself.

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