The easiest way to understand landed cost is to think of it as the complete investment behind an imported vehicle.

Every imported vehicle represents a financial commitment. Whether you’re buying a single car for personal use or importing multiple vehicles for resale, knowing how much capital is tied to each vehicle is essential for making informed decisions. Landed cost provides a structured way to measure the total investment behind an import, making it easier to budget, compare vehicles, and evaluate potential returns.

In this guide, you’ll learn how to calculate total landed cost for cars in Nigeria, understand the costs that make up the calculation, and identify the factors that can influence the final amount.

What is the Total Landed Cost of a Car?

The total landed cost of a car is the total amount required to import and clear a vehicle in Nigeria. It includes the cost of acquiring the vehicle, shipping, duties and levies, port charges, clearing fees, inland transportation, and other import-related expenses incurred before the vehicle is delivered to its final destination. 

It is a common benchmark used by dealers, vehicle importers, fleet operators, and individual buyers when estimating the overall cost of an import before making a purchase or pricing a vehicle for resale.

What Makes Up a Car’s Total Landed Cost?

Before you can calculate a car’s total landed cost, you need to identify where the final figure comes from. Every vehicle import follows the same process: you first determine the vehicle’s import value, then calculate the statutory charges payable to the Nigeria Customs Service, and finally add the costs of clearing and taking delivery of the vehicle.

The Vehicle’s Import Value (CIF)

The starting point is the vehicle’s CIF (Cost, Insurance and Freight) value. This combines the cost of acquiring the vehicle with the cost of shipping it to Nigeria and any insurance purchased for the shipment. If you’re still deciding how to ship your vehicle, understanding the difference between RoRo and container shipping can help you estimate your freight costs more accurately.

Since several statutory charges are calculated from the CIF value, it forms the foundation of every landed cost calculation.

Statutory Charges

Once the CIF value has been established, the next step is calculating the government charges required to clear the vehicle. These include import duty, the National Automotive Council (NAC) Levy, ETLS Levy, VAT, and Green Tax.

Not every charge is calculated the same way. Some are based on the CIF value, others on the FOB value, while VAT is calculated after several of the other charges have already been applied.

Operational Costs

The final part of the calculation covers the costs of clearing and collecting the vehicle after it arrives in Nigeria. These include terminal charges, agent clearance fees, documentation costs, inland transportation, and, where applicable, demurrage charges.

While these costs are separate from Customs duties and taxes, they’re still part of the amount you’ll spend before the vehicle is ready for use. Once all three parts have been accounted for, you’ll have the vehicle’s estimated total landed cost.

How to Calculate Total Landed Cost for Cars in Nigeria

Let’s assume you’re importing a used 2019 Toyota Avalon 2.5L Hybrid Engine.

Item	Amount
Purchase price	$9000
Export documentation and clearance	$300
Local transportation to port	$200
Ocean freight	$2200
Insurance	$108

Start With the FOB Value

Start by determining the FOB (Free on Board) value, which represents the purchase price of the vehicle together with the costs of preparing and delivering it to the port of export.

FOB = Purchase Price + Export Documentation & Clearance + Local Transportation to Port

$9,000 + $300 + $200 = $9,500

Calculate the CIF Value

Next, add the freight and marine insurance costs.

CIF = FOB + Freight + Insurance

$9,500 + $2,200 + $108 = $11,808

Convert the CIF value to naira using the exchange rate.

$11,808 × ₦1,408 = ₦16,625,664

Work Out the Import Duty

Import Duty is charged at 20% of the CIF value.

20% × ₦16,625,664 = ₦3,325,132.80

Apply the NAC Levy

Since this is a used vehicle, the applicable NAC Levy is 5% of the CIF value.

5% × ₦16,625,664 = ₦831,283

Calculate the ETLS and FOB levy 

The ETLS Levy is charged at 0.5% of the CIF value, and the other is 4% of the FOB value.

0.5% × ₦16,625,664 = ₦83,128

4%($9,500 × ₦1,408) = ₦535,040

Apply the Mandatory Surcharge

The surcharge is calculated at 7% of the Import Duty.

7% × ₦3,325,132 = ₦232,759.30

Check Whether Green Tax Applies

Green Tax depends on the vehicle’s engine capacity.

Since the 2019 Toyota Avalon is fitted with a 2.5L (2,487cc) engine, it falls within the 2,000cc to 3,999cc category and attracts a 2% surcharge.

2% × ₦16,625,664 = ₦332,513

Calculate VAT

VAT is calculated after the other statutory charges have been added.

First, determine the VAT base:

CIF + Import Duty + NAC Levy + ETLS + FOB + Surcharge + Green Tax

₦16,625,664 + ₦3,325,132 + ₦831,283 + ₦83,128 + ₦535,040 + ₦232,759 + ₦332,513 = ₦21,965,520

Next, calculate VAT:

7.5% × ₦21,965,520.90 = ₦1,647,414

Add the Remaining Costs

The final step is to include the costs of clearing and taking delivery of the vehicle. These vary depending on the terminal, clearing agent, and destination, but a typical breakdown might look like this:

Terminal handling charges: ₦450,000

Clearing agent fees: ₦700000

Vehicle delivery: ₦250,000

Total Operational Costs = ₦1,400,000

Your Estimated Landed Cost

Once every cost has been accounted for, add them together to estimate the total amount required to import and clear the vehicle.

Total Landed Cost = CIF Value + Import Duties, Taxes & Levies + Port & Clearing Charges + Inland Transportation + Other Associated Costs

Based on this example, a 2019 Toyota Avalon purchased for $9,000 would have an estimated landed cost of ₦24,013,934. The final amount may differ resulting from naira conversion, Customs reassessments, or demurrage charges that may arise during the import process.

Buying Cars from Auctions Abroad?

Once you’ve decided to move forward with a purchase, the next step is securing the vehicle.

Online auto auctions have strict payment deadlines, and delays can lead to cancellation or storage fees and other additional costs.

Pay auction platforms quickly and securely in USD when you’re ready to complete your purchase.

What Can Affect Your Total Landed Cost?

Even with a detailed estimate, your final landed cost may change due to factors like

Customs valuation: The Nigeria Customs Service determines the customs value used for assessment, which may differ from your purchase price or initial estimate.

Exchange rate: Changes in the exchange rate can affect the naira value of your vehicle and other import-related charges.

Engine capacity: Vehicles with larger engine capacities may attract Green Tax, increasing the overall landed cost.

Vehicle classification: Customs charges may vary depending on how a vehicle is classified, including factors such as its engine capacity, fuel type, and tariff heading.

Shipping method and route: Freight costs vary depending on whether the vehicle is shipped through RoRo or container, as well as the country and port of origin.

Port storage and delays: Delays in clearing a vehicle can result in additional storage or demurrage charges at the port.

Regulatory changes: Updates to import duties, levies, taxes, or customs policies can affect the total amount payable before a vehicle is cleared.

VehCAP certification: Vehicles now require SON-NADDC VehCAP certification before they can clear, which carries its own administrative fee separate from the customs duty stack.

Frequently Asked Questions