Wednesday, September 28, 2016

A Look At Nigeria’s First Automobile Manufacturer.....Innoson Vihecle Manufcture(IVM)

Despite not having an academic background in engineering, Nigerian-born entrepreneur, Innocent Chukwuma, or Innoson as he prefers to be called, has become something of a trailblazer and catalyst in the African automotive landscape.
This man is responsible for launching Africa’s first indigenous motor brand: Innoson Vehicle Manufacturing Company (IVM), though his journey has not been without challenge.
Industry and Infrastructure
For many years, Nigeria, with its population of some 160 million people, has been a significant market for many of the world’s automobile giants. Germany alone has more than six out of its 32 major motor brands on Nigeria’s roads, while there are 12 Japanese brands represented. The UK, France, South Korea and the US also export motor vehicles to Nigeria.
Between 1970 and 1985, the Nigerian government, in a bid to promote industrialisation and facilitate technology transfer, established six vehicle manufacturing companies: Peugeot Automobile Nigeria Ltd (PAN), Anambra Motor Manufacturing Ltd (ANAMMCO), Volkswagen Nigeria Ltd, Steyr Nigeria Ltd, National Truck Manufacturers, and Leyland Nigeria Ltd. The companies were set up as partnerships with foreign auto manufacturers: Peugeot, Daimler-Benz, Volkswagen, Steyr, Fiat and Leyland respectively. Parts for assemblage where shipped in both completely-knocked-down and semiknocked-down formats. The finished products carried the brand names of their original manufacturers.
Buses manufactured at INNOSON Vehicle Manufacturing (IVM) Co. Ltd, Nnewi, Anambra State, Nigeria
Buses manufactured at INNOSON Vehicle Manufacturing (IVM) Co. Ltd, Nnewi, Anambra State, Nigeria
Despite their affiliations with both government and expatriates, the six companies slowly declined. Over the years, their fates presented a barrier for further investment in the Nigerian automobile industry as many investors considered motor manufacturing too precarious a venture. Currently, out of the six companies, only two – PAN and ANAMMCO – still function, though at only 10 percent of their installed capacities. The other four are defunct.
The manufacture of automobiles requires large amounts of electricity. Given Nigeria’s current power situation, this poses quite a quandary. Many local manufactures use diesel-powered generators in order to keep up production – regardless of industry. Unfortunately, the costs they incur in the process almost always reflect in their pricing. Additionally, consumers tend to prefer foreign products, which they believe offer more value for money.
Despite these challenges, many Nigerians continue to ask whether there could ever be a Nigerian car brand. It was this same question that urged Innoson to pursue his motor manufacturing dream.
In October 2010, Innoson unveiled his multi-billion-naira car assembly factory, located in his hometown of Nnewi in south eastern Nigeria. While his success is welcome, it has raised questions and doubts, as well as scorn. Many people wonder about IVM’s longevity.
The Man Behind the Brand
Innocent Chukwuma is the founder and CEO of the Innoson Group of Companies – the conglomerate which owns IVM. He began his career as an auto-sales apprentice in Nnewi in 1976. In 1981, he began selling motorcycle parts before moving towards motorcycle manufacturing. During this time he also established the Enugu-based plastics manufacturing company – Innoson Technical and Industrial Company Limited. Today, it is the largest manufacturer of plastic products in Nigeria, as well as the largest manufacturer of crash helmets in West Africa.
Local Support and Room for Growth
Innoson’s IVM motors was set up with the assistance of Chinese expatriates. At its inauguration in 2010, IVM already had in its product line SUVs, mini and long buses, heavy-duty vehicles, patrol vans and pick-up vans, easily establishing itself as a versatile automobile company capable of meeting a wide range of product demands.
Innoson Vehicle
In any economy, the automobile industry serves as a good platform for both technological and socioeconomic development because it provides growth opportunities and jobs for local manufacturers, especially those who engage in the production of iron, steel, rubber, plastics and electrical components. Although the engines for IVM vehicles are imported, 60 percent of other parts are produced locally, making both assemblage and repair quick and convenient.
A Way Forward
IVM’s models are more affordable than many foreign brands, which gives the company a distinct advantage. But IVM still has a long way to go if it hopes to gain a foothold in the hearts and minds of Nigerian consumers.
To date, IVM has enjoyed reasonable support locally. The Nigerian government as well as some state governments purchased hundreds of IVM vehicles for their ministries and parastatals. IVM also supplies long buses to churches and schools, with companies such as Orizu Motors, E Ekesons Bros, Young Shall Grow Motors and Autostar using IVM buses as well. IVM also exports products to Ghana.
The Nigerian government has a role to play in ensuring that IVM enjoys a home field advantage. Increasing patronage, providing infrastructural facilities at very low tariffs, reducing tax and cutting the flow of fairly-used automotive products into the country would help IVM’s competitive advantage. The emergence and ultimate success of IVM is not just one man’s victory. It is a landmark happening for all of Africa – and could be a sign of greater things still to come.

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