Nigeria spent an estimated N1.71 trillion ($1.18 billion) on used vehicle imports in 2025, underscoring the country’s deepening dependence on second-hand cars as currency weakness, inflation and falling purchasing power continue to price new vehicles beyond the reach of most consumers.
Market research by Mordor Intelligence puts the full-year import bill at N1.71 trillion, a figure that closely aligns with official data from the National Bureau of Statistics (NBS), which shows passenger car imports alone hitting N1.01 trillion in the first nine months of 2025.
The trend peaked dramatically in the third quarter, when imports surged to a record N527 billion, the highest quarterly value ever recorded. Analysts say the numbers reflect a structural shift in Nigeria’s auto market, where used vehicles popularly known as Tokunbo have become the default option for households and businesses squeezed by high interest rates, volatile foreign exchange markets and persistent inflation.
Q3 spike exposes FX dynamics
NBS foreign trade data reveal a sharp acceleration in import values as the year progressed. Passenger vehicle imports stood at N224.58 billion in Q1, rose modestly to N254.67 billion in Q2, before more than doubling in Q3 to N527 billion, pushing the nine-month total to about N1 trillion.
Economists attribute the Q3 spike largely to exchange-rate dynamics. Periods of relative FX stability encouraged importers to front-load purchases, while continued depreciation of the Naira inflated the Naira value of vehicles priced in Dollars.
“Even when unit volumes are flat, depreciation alone can produce eye-catching growth in import values,” said an industry analyst. “What we are seeing is both a price effect and a demand effect driven by the collapse of affordability for new cars.”
US dominates Nigeria’s used-car supply
The United States remained Nigeria’s dominant source of used vehicles in 2025, accounting for 41 to 44 per cent of total passenger car imports. NBS figures show that imports from the US were valued at about N415 billion in the first nine months of the year, far ahead of other suppliers.
Smaller volumes came from South Africa and the United Arab Emirates, which continue to serve as secondary hubs for re-exported vehicles. Dealers cite better vehicle availability, clearer documentation and competitive pricing as reasons for the US’s commanding share.
Local assembly still struggling
The ballooning import bill has renewed questions about the effectiveness of Nigeria’s automotive policy, which aims to promote local assembly and reduce dependence on imports. Despite tariff incentives and policy support, local plants continue to struggle with high production costs, limited access to affordable financing and weak consumer demand for new vehicles.
Industry insiders say that until macroeconomic conditions improve particularly exchange-rate stability and access to consumer credit used imports will continue to dominate the market.
Outlook: N1.85trn in 2026
Projections from market researchers suggest Nigeria’s used vehicle import bill could rise further to about N1.85 trillion in 2026, assuming current trends persist. Such growth would deepen pressure on foreign exchange demand and complicate efforts to rebalance the trade account.
For policymakers, the numbers present a dilemma: While used vehicles fill a vital mobility gap for millions of Nigerians, the scale of imports highlights the economy’s vulnerability to FX shocks and the long road ahead for domestic industrialisation.
