Nigeria’s ₦500M Electric Vehicle Bill: Can It Truly Jumpstart Local EV Manufacturing?

On November 5, 2025, a document was presented to the Nigerian Senate that did more than just propose a law; it issued a challenge. The Electric Vehicle Transition and Green Mobility Bill, now through its second reading, isn’t just a regulatory file. It is a high-stakes, high-risk blueprint for an industrial resurrection.

According to TechPoint, sponsored by Senator Orji Uzor Kalu, the bill is a potent cocktail of massive incentives, strict mandates, and eye-watering penalties. Its central provision? A ₦500 million fine ($X million USD) for every single shipment of electric vehicles brought in by an unlicensed importer.

This isn’t a gentle nudge towards green energy. It’s a shove.

234 Drive reports that, if passed, this legislation would catapult Nigeria into a tiny, elite club of African nations, alongside Rwanda and Ethiopia, with fully codified EV laws. However, while its peers have concentrated on offering incentives to attract adopters, Nigeria is constructing a robust regulatory framework. The bill’s language emphasises strict oversight, compliance, and, most contentiously, a demand for local production.

It is an interventionist strategy so bold that analysts are torn between calling it “visionary” and “impossible”.

At the heart of the bill lies the dream of a forgotten era. It contains an ambitious local content provision: by 2030, at least 30% of all EV components must be sourced locally. Furthermore, foreign automakers setting up shop must partner with Nigerian assemblers and have functioning assembly plants within three years.

The explicit goal is to revive the once-thriving domestic automotive industry.

“This bill is at least 30 years overdue,” insists Sam Faleye, CEO of SAGLEV, Nigeria’s only large-scale electric vehicle assembler. For Faleye, this isn’t just policy; it’s a painful course correction.

The industry’s collapse, Faleye argues, was driven by policy inconsistency, allowing Nigeria to become a “dumping ground”. The numbers are damning: between 600,000 and 700,000 vehicles are imported annually, and over 80% of them are used—the “Tokunbo” cars that clog Lagos’s streets. Meanwhile, local plants struggle to produce 10,000.

“It’s a disastrous imbalance,” Faleye states. “Every imported used car drains value from the economy instead of creating jobs or advancing local technology.” He points to Morocco and South Africa, nations that built robust auto sectors by “insisting on local manufacturing”. The new bill, he argues, is Nigeria’s long-overdue attempt to do the same.

Although the vision is compelling, the implementation is where the challenges arise. Industry leaders are sounding a note of caution, warning that the bill’s ambition may be writing checks the country’s infrastructure can’t cash.

“A 30% local content requirement by 2030 may not be realistic given Nigeria’s current infrastructure and workforce constraints,” says Stanley Awelewa, Senior Sales Manager of Tim International Group, which is a provider of innovative logistics services. “A ten-year roadmap would be more feasible, giving time for technology transfer and capacity building.”

Dapo Adesina, President of the Electric Mobility Promoters Association of Nigeria (EMPAN), echoes this. He urges the government to adopt “short-, medium-, and long-term goals” that reflect reality.

Adesina notes a key advantage: electric vehicles are mechanically simpler than their combustion-engine ancestors, with far fewer moving parts. Three core systems comprise an EV: propulsion (the motor), energy storage (the battery), and the vehicle structure. This simplicity, combined with a recent discovery, presents a golden opportunity.

“With the discovery of lithium in commercial quantities in some parts of Nigeria, production of batteries can commence in a short time,” Adesina explains. If the targets are set correctly, it could trigger a boom in industrialisation and tech transfer.

Still, the bill’s most debated clause remains the ₦500 million fine. Critics view it as a harsh measure in a situation that calls for a more nuanced approach.

“₦500 million is a significant deterrent,” Awelewa warns. “It risks stifling innovation before the industry can mature,” potentially scaring off the very startups and small assemblers Nigeria needs.

Faleye is entirely unmoved by this argument. “When you do the math, ₦500 million roughly equals the value of nine or ten vehicles,” he explains. “It’s not punitive; it’s a deterrent.” His logic is simple: if you can’t meet the licensing and safety requirements, you shouldn’t be in the business. “The idea is to push players to invest locally instead of cutting corners.”

Supporters of the bill view the fine as a necessary addition to the previous 2013 Automotive Industry Development Plan (NAIDP). That plan was a broad framework; this new bill is a targeted weapon, complete with environmental goals and compliance measures tied to Nigeria’s climate commitments.

Even if the policy is perfect, a fundamental paradox remains: how do you run a nationwide fleet of electric cars in a country with an unreliable national grid?

The bill boldly mandates that every fuel station in Nigeria must install EV charging points. In principle, this is transformative. In practice, it faces staggering hurdles. Nigeria’s grid is notorious for frequent power cuts and limited rural coverage.

“The bill does not yet outline clear mechanisms for renewable integration,” Adesina points out. Without deep collaboration between the Ministry of Power and the private sector, the charging points will be little more than expensive lawn ornaments.

Further, a requirement for assemblers to produce 5,000 vehicles annually could squeeze out smaller players, shrinking the field rather than expanding it.

The stakeholders’ complaint is their lack of invitation to the drafting process of the bill. Key associations, such as EMPAN, according to both Awelewa and Adesina, were not formally involved in drafting the bill.

“We’re now making efforts to reach the sponsor of the bill and the Senate Committee on Industry,” Adesina says, highlighting the need for a collaborative process to make the law “practical and sustainable”.

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Faleye, while agreeing that collaboration is key, is impatient with delays. “We’ve wasted decades on policy paralysis,” he says. “Even if the timelines are aggressive, it’s better to act now and refine later than to keep waiting.”

This split defines the entire debate: a race to act versus the need to behave correctly.

Across the continent, Nigeria’s “control-first” approach stands in stark contrast to its neighbours. Kenya is slashing import duties and VAT. Rwanda is offering full tax exemptions, cheap electricity, and land grants and has even decreed that only e-motorbikes will be registered in Kigali starting in 2025.

Nigeria is coupling its incentives with heavy compliance, high-stakes penalties, and a demand for local investment. It’s a gamble, but the potential payoff is enormous.

With 15,000–20,000 EVs already on the road and a projected annual growth rate of 30.6%, demand is not a problem. “We’re already sold out,” Faleye says. “The demand is huge; financing and local assembly capacity are the constraints.”

“This is not a ‘nice-to-have’ policy; it’s survival,” he concludes. “If Nigeria doesn’t manufacture, we’ll keep importing old cars that do nothing for our economy. The political will must match the ambition.”

Currently, Nigeria’s EV market is a small but rapidly growing niche, dominated by grey market imports. The majority of EVs on Nigerian roads (primarily in Lagos and Abuja) are “Tokunbo” (used) vehicles imported from the US and Europe. Teslas, Nissan Leafs, and Chevrolet Bolts are familiar sights, purchased by wealthy individuals and tech-savvy professionals willing to navigate the charging challenge.

A few forward-thinking logistics and haulage companies, such as Tim International Group, are experimenting with electric vans and cars, along with e-hailing services, in response to corporate and commercial adoption, to escape Nigeria’s volatile and subsidy-free fuel prices.

Players like SAGLEV and Jet Motors are pioneers, assembling vehicles in SKD (semi-knocked-down) or CKD (completely knocked-down) forms. They are the local champions the bill seeks to empower.

Charging infrastructure is the main hurdle. It’s almost non-existent publicly. Most EV owners rely on charging at home, often powered by diesel or petrol generators, which completely negates the “green” aspect of “green mobility”.

The bill is an attempt to impose order on this chaos. It seeks to formalise the market, choke off low-quality, unsafe grey-market imports, and use policy to solve the “chicken-and-egg” problem of infrastructure.

The transition to electric mobility, as envisioned by the bill, could have a profound and transformative impact on tourism, both positive and negative.

In terms of ecotourism and green safaris, Nigeria’s national parks, such as Yankari Game Reserve or Kainji National Park, could market themselves as premier ecotourism destinations. Imagine silent, emission-free electric safari vehicles that enable tourists to approach wildlife closely without disturbing them. This is a high-value, niche market.

A successful EV transition, powered by renewables, could help rebrand Nigeria, moving its image away from an oil-polluted state to a forward-thinking, green-tech leader. This “clean” image is beautiful to modern international tourists.

For tourists in cities like Lagos or Abuja, the availability of clean, quiet, and modern electric ride-sharing services (like e-bus tours or e-taxis) would significantly improve the urban experience, reducing the noise and air pollution that currently detracts from it.

The primary risk is failure. A tourist stranded in a remote area with a dead EV battery due to a non-functional charging station is a public relations disaster. The unreliability of the grid could make “EV tourism” a dangerous gamble.

If the charging infrastructure is powered by the current grid (which relies on fossil fuels) or, worse, local diesel generators, the entire “eco-tourism” concept becomes a farce. Exposing this greenwashing quickly would damage the country’s credibility.

Nigeria is the anchor of West Africa. A successful EV charging network could pioneer the first “EV tourism highway” in the region, connecting Lagos to Cotonou, Lomé, and Accra. This would revolutionise regional road-trip tourism.

If Nigeria’s bill succeeds, it will pressure neighbouring countries, such as Ghana and Benin, to adopt compatible standards, creating a unified regional market. If it fails, or if they adopt different standards (e.g., different plug types), it will create “EV islands” and make cross-border travel more difficult, thereby hurting regional tourism integration.

For more in-depth analysis on Nigeria’s tech, policy, and industrial future, follow Rex Clarke Adventures and explore our related articles on green energy.

 

FAQs

1. What is the new Nigerian Electric Vehicle Bill?

A proposed law in the Nigerian Senate aims to regulate and boost the country’s electric vehicle (EV) sector. It combines incentives for adopters with strict mandates for local manufacturing, partnership requirements for foreign companies, and plans for a nationwide charging network.

2. What is the ₦500 million fine in the bill?

The bill proposes a ₦500 million fine per shipment for any individual or company that imports EVs without a proper licence and certification. Supporters call it a necessary deterrent to stop grey-market imports, while critics fear it will stifle small businesses.

3. What are the local content requirements?

The bill mandates that by 2030, at least 30% of EV components must be sourced locally. It also requires automakers to establish local assembly plants within three years of starting operations, aiming to create jobs and revive the domestic auto industry.

4. What are the main challenges facing the bill?

The primary challenges are Nigeria’s unreliable electricity grid, which makes a nationwide charging network difficult, and the aggressive timeline for local content, which industry experts warn may be unrealistic. There are also concerns about a lack of stakeholder consultation in drafting the bill.

5. How does Nigeria’s EV plan differ from Rwanda’s or Kenya’s?

While countries like Rwanda and Kenya are focused heavily on incentives (like tax exemptions and reduced duties) to drive EV adoption, Nigeria’s plan is far more interventionist. It couples incentives with heavy compliance mechanisms, high penalties, and a strong, non-negotiable focus on local manufacturing and content.