Market Size of Sub Saharan Africa Automotive Industry
| Study Period | 2019 - 2029 |
| Base Year For Estimation | 2023 |
| Market Size (2024) | USD 20.53 Billion |
| Market Size (2029) | USD 26.38 Billion |
| CAGR (2024 - 2029) | 5.15 % |
| Market Concentration | Medium |
Major Players
*Disclaimer: Major Players sorted in no particular order |
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Africa Automotive Market Analysis
The Sub Saharan Africa Automotive Market size is estimated at USD 20.53 billion in 2024, and is expected to reach USD 26.38 billion by 2029, growing at a CAGR of 5.15% during the forecast period (2024-2029).
The COVID-19 pandemic had a significant impact on the market, and demand is still lagging behind pre-COVID levels. Until 2018, the demand for new vehicles in the African region increased. However, governments across the region are taking initiatives to boost the automotive industry by implementing a ban on imported used vehicles. According to the data from the National Automotive Design and Development Council (NADDC), Nigeria spends about NGN 2.88 trillion (USD 8 billion) on the importation of about 300,000 to 400,000 cars, yearly.
Over the medium term, some governments in Sub-Saharan Africa have begun to announce vehicle electrification targets and incentives for EV adoption, such as Rwanda's tax exemptions for EV sales. Furthermore, a burgeoning start-up ecosystem for EVs, with a focus on electric two-wheelers, is emerging in the region. According to automotive experts, there were more than 20 start-ups in the ecosystem at the end of 2021, with total funding of more than $25 million that year.
Additionally, to discourage the importation of vehicles and encourage local vehicle production, Nigeria slammed 70% import duty and levied on imported vehicles. This resulted in increased volume of locally assembled and manufactured vehicles in the country and most of the local companies have seen developments in their manufacturing process and capacity. For instance,
- Innoson Vehicles Manufacturing Limited (IVM) opened a new automated plant for manufacturing bus at Nnewi, Anambra State, in 2019. The automated plant reduced the cost of new 15-17-seater Hummer bus from NGN 16 million to NGN 9 million.
However, Due to low disposable income and very high cost associated with new vehicles, used vehicles dominate some of sub-saharan countries automotive retail sector. These vehicles are mainly imported from regions with low resale or residual values of used vehicles like Europe, Japan, and the United States. This might hamper the target market during the forecasted timeperiod.
