Personal opinion:

The relationship between cars and Petrol is complementary in nature. Complementary in the sense that, one is needed to augment the other, just like garri and kulikuli.

Going by basic economics principle, there is an inverse price relationship between complementary goods i.e an increase in the price of one results in decrease in the demand for the other. With this, it is conceivable that with increase in the price of petroleum, there will be less demand for cars, hence result in price crash occasioned by excess supply over demand.

Also, from the angle of the Federal government, the rich benefit more from the subsidy. People with ten cars will now find it unfunny fueling the convoy, and this may result in selling off some of the vehicles. This should further increase the supply of cars and drive down the price.

Let's talk about this, do you see the price of cars crashing? Let's leave out the Nigerian factor, corruption, and base our argument on fact.

There is very strong likelihood that the prices of 4 cylinder engine cars will maintain its status quo or soar higher especially that uber Corolla that is highly demanded.

the most possible effect will be people shifting to diesel-engine cars , which are even cheaper. because if diesel and petrol are almost the same price then it is better for one to be using diesel engines

zeenaman:
Personal opinion:

The relationship between cars and Petrol is complementary in nature. Complementary in the sense that, one is needed to augment the other, just like garri and kulikuli.

Going by basic economics principle, there is an inverse price relationship between complementary goods i.e an increase in the price of one results in decrease in the demand for the other. With this, it is conceivable that with increase in the price of petroleum, there will be less demand for cars, hence result in price crash occasioned by excess supply over demand.

Also, from the angle of the Federal government, the rich benefit more from the subsidy. People with ten cars will now find it unfunny fueling the convoy, and this may result in selling off some of the vehicles. This should further increase the supply of cars and drive down the price.

Let's talk about this, do you see the price of cars crashing? Let's leave out the Nigerian factor, corruption, and base our argument on fact.

in my opinion, the number of cars to be sold off by the rich will be insignificant to the number of average persons to by them.

That is to say the if 100,000 cars are to be sold, there will be up to ten million people ready to buy. So it will have not impact on the prices of vehicles.

Hmmm... Its supposed to force down demand on big engine cars (especially) and a such price fall.

However, this is Nigeria and most times issues like this usually defy any economic reasons.

Let's watch and see.