NEV Electric launches EV plant in Abuja

From the newsletter

Nigerian electric vehicle company NEV Electric has launched an assembly plant in the capital Abuja. The company, which was Nigeria’s first EV manufacturer, is primarily targeting to supply the local market. NEV Electric makes different types of vehicles including cars and buses. It recently launched a fleet of e-buses. 

• NEV Electric’s plant marks a further milestone for Abuja’s manufacturing industry. The city is also the home of automaker Stallion Group and its subsidiary, Hyundai Nigeria. The company made Nigeria’s first locally-assembled EV, the Hyundai Kona, which was unveiled in February 2024.

• This week, NEV Electric also launched a fleet of electric buses that will be used for public transport. The company is seeking to grow its local market share with its new production capacity. 

More details

• Nigeria’s EV assembly industry is growing steadily, with a number of EV firms having recently built or announced plans to build new plants. Existing local EV assemblers in the country include Innoson Vehicle Manufacturing Company, Electric Motor Vehicles Company of Nigeria Limited and Jet Systems Automobile Industries Limited.

• Africa’s leading EV manufacturer Spiro, which operates in seven African countries, is also set to open a new high-capacity assembly plant in the country. The EV assembly plant will have a capacity to produce 100,000 electric motorcycles each year. It will be located in Nigeria’s Ogun State and will be opened by March 2025.

• Nigeria’s shift to EVs is being propelled by both the public and private sectors. For instance, the Lagos State Government is planning to deploy 1,000 e-buses as part of its Lagos Mass Transit Master Plan. The Katsina State Executive Council has also approved bulk purchases of electric and solar-powered vehicles under its public transportation programme.

• The uptake of EVs in Africa remains small, although demand is growing. Statistics obtained from the Nigeria’s National Bureau of Statistics (NSB) show that in 2020, 2021 and 2022, the percentage of electric car sales in Nigeria were 4%, 5% and 7%, respectively.

• This means that local EV assemblers such as NEV Electric and Innoson have a market opportunity to grow their market shares in the populous country of more than 223 million people. However, high prices of EVs and a severe lack of charging stations has derailed the country’s e-mobility transition. 

Our take

• Nigeria is notorious for unstable power supply. The country experienced more than 10 grid failures in 2024. It can only transmit 4,000 MW due to weak infrastructure, which is not enough to power its huge population. This situation would be worsened by additional load from EVs. For Nigeria to make significant progress in EV adoption, it must first address its power generation shortages. 

• In developed EV markets such as Europe and the US, theft of EV charging cables is becoming a menace. These cables, as well as related components, are expensive. This issue has been reported in Nigeria, although at a lower scale as the country still has only a few charging stations. However, security of charging infrastructure should be assured to give investors confidence to invest in the sector which is badly in need of capital. 

• Renewable energy has immense potential in Nigeria, especially solar. Prices of solar components are plummeting globally, making it cheaper to undertake capital-intensive solar projects that were previously uneconomical. This trend is making renewable energy cheap globally. Nigeria should tap into this resource to make electricity affordable and accessible to facilitate the switch to EVs.