Nigeria’s passenger motor car imports recorded a strong rebound in 2025, driven largely by improved stability in the foreign exchange market that restored confidence among importers after months of volatility.

Official trade figures show that the value of passenger car imports rose to ₦1.01 trillion in the first nine months of 2025, marking a significant turnaround from the sluggish performance recorded in the same period of 2024. The growth reflects easing currency pressure, better access to foreign exchange, and improved planning conditions for dealers and logistics operators.

Weak Start Gives Way to Strong Recovery

The recovery did not come evenly across the year. In the first quarter of 2025, car imports declined compared to the same period of the previous year, as importers remained cautious following prolonged exchange rate instability and rising landing costs. The second quarter followed a similar pattern, with demand still weighed down by uncertainty in pricing and customs duties.

However, the trend shifted decisively in the third quarter. Between July and September, passenger vehicle imports surged sharply, more than offsetting earlier declines. This late-year rebound pushed overall import values well above 2024 levels and confirmed renewed confidence in the market.

United States Remains Dominant Source

Data shows that the United States remained Nigeria’s largest source of passenger vehicles in 2025, accounting for more than 40 percent of total imports during the nine-month period. The majority of these vehicles were used cars with larger engine capacities, reflecting consumer preferences shaped by affordability concerns and availability.

South Africa and the United Arab Emirates also featured as notable sources, though at significantly lower volumes. The UAE’s contribution became more visible in the third quarter, particularly for petrol-engine vehicles and semi-knocked-down imports.

FX Stability Drives Import Confidence

Analysts attribute the rebound in vehicle imports largely to improved stability in the foreign exchange market, particularly in the third quarter of the year. The naira maintained a relatively narrow trading range, supported by increased dollar inflows, stronger external reserves, and sustained interventions by monetary authorities.

This stability reduced uncertainty for importers, allowing them to price vehicles more accurately, plan shipments ahead of time, and manage customs obligations with greater confidence. For many dealers, the predictability of exchange rates proved more important than absolute currency strength.

Customs Reforms Offer Additional Relief

Beyond FX stability, recent adjustments in customs valuation methods also played a role in reviving vehicle imports. The revised approach to duty assessment now factors in depreciation, mileage, and wear-and-tear for used vehicles, helping align import costs more closely with market realities.

Freight forwarders and port operators have reported a noticeable increase in vehicle volumes at major terminals, confirming that the rebound is visible not just in data but on the ground.

Recovery Signals Confidence, Not Affordability

While the import surge reflects renewed business confidence, analysts caution that it does not necessarily mean vehicles have become affordable for the average Nigerian. High inflation, elevated interest rates, and limited access to credit continue to constrain consumer demand.

Instead, the data suggests that importers are responding to a more predictable operating environment, even as end-users still face high prices. Vehicle imports, therefore, remain a sensitive indicator of broader macroeconomic conditions.

Outlook for the Auto Import Market

Looking ahead, economists expect passenger car imports to remain relatively strong if exchange rate stability is sustained and inflation continues to moderate. However, risks remain, including potential swings in global oil prices, changes in FX inflows, and shifts in trade policy.

For now, the 2025 rebound marks a notable improvement after two years of pressure, signalling cautious optimism in Nigeria’s import-dependent auto market and reinforcing the critical role of FX stability in restoring economic confidence.