The Biggest Threat of Current Automobile Business Environment

Published: 2021-06-29 06:58:01
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Category: Business

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Nowadays, most automobile companies in developing country are facing poor policy implementation. For example, Nigeria established their automobile companies based on policy that create by the government. The Nigeria government want to protect and patronize the existing automobile industries in the country (Akiegwe 2010). They established this law to assist and protect the local Automobile industries but government are importing foreign made Automobile rather than patronizing Nigerian made Automobile cars.The second challenge is high tariff is imposed by the government to those imported cars. Even though the interest rate of purchasing the new vehicle is very high. For example, buying a new vehicle in Nigeria is very high, and most Nigerian cannot afford to buy a vehicle of his choice (Maura, 1997). Besides, Russia reduce 5% interest rate car loan to encourage the local industries by indirectly reducing tax for part of the automobile industries (Alexei, 2017).The next challenge is the government lack of fund to support their own automobile companies in their country. For example, the cost of automobile industry in Nigeria is responsible by the owners of the companies because their government never try to think a way to support and encourage the local companies, by ensuring or creating a conducive atmosphere for them to operate, but rather creating a way to share in the company’s profit, by increasing the company tax yearly as a way of paying for their existence in the country (Bisiriyu, 2012). Besides, the government of the country has failed to fund automobile industry they are affecting most automobile industries in their own country.

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