Local Vehicle Dealers Call for Reforms to Address Unfair Competition
The Vehicles and Assets Dealers Union of Ghana (VADUG) has called for urgent policy reforms to address what it describes as unfair competition within Ghana’s automobile market, warning that the growing presence of Chinese vehicle manufacturers and assemblers is threatening local businesses and jobs.
Speaking at a press conference in Accra, VADUG President Bernard Ntrakwa said local vehicle dealers are increasingly facing challenges as Chinese automobile companies expand their operations beyond manufacturing and assembly into direct retail sales.
According to the union, local dealers importing used vehicles from the United States, Europe and Japan are required to pay between 35 and 50 percent in taxes and duties, while Chinese assemblers importing Semi-Knocked Down (SKD) and Completely Knocked Down (CKD) kits benefit from tax exemptions under Ghana’s automotive policy.
VADUG argues that the disparity has created an uneven playing field, enabling Chinese brands to gain a larger share of the market while local dealers struggle with declining sales and longer inventory turnover periods.
“We do not oppose foreign investment. But this current trend is unsustainable,” the union stated.
The association further questioned the increasing involvement of foreign automobile manufacturers in retail activities, noting that major brands from countries such as the United States, Japan, Germany and South Korea have traditionally relied on local dealership networks to distribute their products.
Beyond competition concerns, the union warned that Ghana could become a destination for ageing internal combustion engine vehicles as China accelerates its transition toward electric vehicles and reduces dependence on petrol and diesel-powered automobiles.
“Without strict regulation from the Ghana Standards Authority, DVLA and GIPC, Ghana risks becoming a dumping ground for substandard cars. That is a safety and environmental time bomb,” VADUG cautioned.
The union is therefore calling on government to review tax and duty structures to create a more level playing field, strengthen vehicle quality and safety standards, and provide financing support to local dealers through institutions such as the Ghana EXIM Bank.
VADUG also criticized the AI Publican customs valuation system, arguing that it has increased import costs by assigning higher values to imported vehicles, resulting in elevated duties.
The union is urging the Ghana Revenue Authority and government to engage industry stakeholders on reforms, including the possible introduction of a flat-rate duty regime for vehicles and spare parts to improve transparency, predictability and competitiveness in the sector.
