Interviewing Chief Michael Ade Ojo, Founder, Elizade Group of Companies and Chairman of Toyota Nigeria Limited, is every Nigerian Motoring Journalist’s delight. Apart from being very blunt and frank about issues relating to the auto industry, Chief Ade Ojo would always give you an advice that can guide you in life if you are one of those that take words of advice from elders very seriously.
Imagine what he told this reporter about wealth and success in an interview. “I describe money as a caged bird. You must feed it to enable it to develop. You should not allow it to escape because if it does, you never can find it again.”
At 80 years, this Nigerian auto industry icon has seen it all as far as the industry is concerned. He has successfully sold many brands including Toyota, Peugeot, Bedford, Volkswagen etc. It is a common belief in the industry that if the government had tapped his vast auto industry experience, the nation would have moved to the next level by now.
In this extract from an interview with him, he shares his success nuggets and unveils his role models whom I am sure you would have not heard of before. He also spoke about the way forward for the comatose nation’s auto industry.
COULD you compare the auto industry then and the business now?
I have always said that we don’t have an auto industry. What we have is motor business. What part of the car do you manufacture? These are the things you people should bother about. I have said it several times that we’re marketing vehicles. We have not been manufacturing vehicles until now. We are only marketing or selling vehicles. You have been to my assembly plant, can you tell me any of the parts that are made in Nigeria?
What do you think can be done to accelerate the development of the auto industry?
First of all, the way they started (the auto policy) was wrong. I said look, you can’t bring somebody to your parlour (living room) and you make him give you rosy things. I said they should advertise this thing for everybody to apply but they didn’t do it like that. They drew this man to themselves, pretended that they were going to manufacture. We are assembling, but it is not the real auto industry. We are not there yet. Even Innoson (Vehicle Manufacturing) is only putting things that have been manufactured together, that is what he is doing. But for the buses, yes, you cut the plates and weld them but it’s not a serious matter. So, I told them we should face the areas in which we have comparative advantage.
What really can be done to put things right?
Let us start with commercial vehicles and this is why we proposed bus. Our factory is for bus, pickup and then car. We did it for the Hiace bus and Hilux pickup. But we could use the same land for pickup to assemble car. So, in our assembly plant, we can actually do those three categories of vehicles. For instance, in Toyota, every half a minute, a car jumps out of the plant. So how can we compete?
In the 80s, PAN and VON were the pride of Nigeria. They were doing very well in producing vehicles locally for the people. What went wrong?
The greatest year of vehicle importation into Nigeria was 1981. That year, Elizade sold 6,000 units. Go and check it. Toyota sold 52,000, Nissan sold 100,000 and Peugeot sold 250,000 units that year. But we overdid it because Gowon said money was not our problem but how to spend it. This was where the problem started. We were importing. And you know oil money had come then. We all neglected farming. We became lazy and that was how Buhari government came into power, took over from the then President Shehu Shagari. It’s a pity. We misused our money. Then, people were stealing; they were doing all sorts of things. The stealing has been long, not now.
Your competitors say Toyota is overpriced today, yet it is the most popular on the road. What is your reaction to that?
Pricing is a function of demand and supply. Let me tell you something. In 1985, I sold 25 cars for the whole year, yet, in 1981, four years earlier, I had sold 6,000 units. The government banned the importation of vehicles. It was a total ban. So, in 1985, I sold only 25 units and I still made profit. You have to be correct in the head to do business. Then, in a day, prices changed three to four times. You come in the morning, I give you a price and you’ll be saying the price is too high and you go, the next person will come I will increase the price and he may or may not buy it, but I don’t have any hope of getting another one. If I sell this, I’ll be left with nothing. What do you want me to do and I have to pay salary? So, when the third person comes, I add some money on top because there is nothing coming from anywhere.
Meanwhile, these 25 units I sold were a mixture of Toyota, Bedford and Peugeot. Maybe that year, I think I only got two units of Peugeot from PAN because I also became a PAN dealer but I got only two vehicles for the whole year. You want me to quickly sell them when I know I cannot get another one in the next one month. So, the price of the car will be increasing per day for me to remain in business. I would not be anxious to sell them because the showroom would be empty and you’ll still pay salary. So, you see demand and supply determine prices. It’s either you buy it or you go away because I’m not anxious to sell the vehicles.
Although the car may be available, there is no dollar to buy it. Did you not read that we reduced the price of Corolla and Hilux because the exchange rate came down? Everything came down and then we reduced the prices. This is what you call business because the difference between the cost and what you sell the car is what you call profit. That’s gross profit before you begin to take away your cost of petrol, diesel, salaries, and so on. A businessman must strive to increase the bottom line. There is no deception.
How many brands did you sell then?
In addition to Toyota, I sold Peugeot and Volkswagen. The company selling our Peugeot was Classic Motors while the one selling Volkswagen was Crown Motors.
Out of all the models you have sold, which one are you emotionally attached to?
When there was Celica, I loved Celica because I loved driving. Land Cruiser is a fantastic car, very fantastic. I think Corolla is wonderful. We have so many models that are fantastic.
Who is your role model sir?
My role models are Dr. Christopher Kolade and Chief Sam Adedoyin.
I like Christopher Kolade’s management style. This man was a journalist and he became a manager. He managed Cadbury very well. I love his managerial skills. He is one of the role models. Then, I have Sam Adedoyin. In 1968, I was living in Adedoyin’s house in Surulere. This man was stupendously rich. At that time, he told me his houses in Lagos were 32 and I had not built a room then. So, I was wondering how I could become like him? I lived in one of his houses. I took a flat and we became friends. He taught me to be thrifty, to save. One of the things I did when I started was to make very good use of my money. I did not waste money and still today, I won’t waste any money and this is where many people get it wrong.
You see in business, you have to be disciplined, discipline is the first principle. In fact, in life, you have to be disciplined in whatever you do. If you throw away discipline, it will be difficult. And you must be determined and diligent. The last one is that you must be dedicated. You need those four principles to be successful in anything you’re doing. When you make your first million, what do you do with it? You must be careful what you do with it.
Money as a caged bird
You see, I describe money as a caged bird. The bird is in a cage and you must feed it, then it will develop. But you must be careful that it doesn’t escape because if it goes out, you may never find it again.
Again, I describe business as seeking an opportunity and seizing it and making use of it. So you must carry out your studies and make sure that what you want to do is the right thing in every aspect. You now need the four ‘D’s to be able to handle it. So, whatever money you make, you must make sure you don’t allow it to ‘fly’ away by your extravagance or drinking too much beer. So, that is where discipline comes. You must believe in what you are doing and that is dedication. But most important is to ask God to support all your aspirations and that puts a lot of responsibility on you.
You can’t be friend with God when you are a thief and if you are doing bad things. So, if you put all these things together, by the grace of God, you are hardworking and you believe in what you are doing, you’ll make it. In the first five years, my late wife and I didn’t take one penny from our business. We were only eating, taking food money, paying children’s school fees and giving them clothes. I was stingy at that time. I didn’t waste money. I may have just five shirts but they will be neat, but no waste at all.
How do you relax?
I do my exercise every day, I still play golf and I walk just to keep the bones together.
Do you think the coming of electric vehicles will change the face of auto industry especially in the Nigerian market as it is today?
Well, it’s likely to take over but there are problems, because even now you’ve a combination of electric and fuel vehicle which they call hybrid. So, electric vehicles are going to be expensive and so many people will not be able to afford them. Most people will want to use what is affordable but technology is not simple it is developing every day until they can find the right answer. We will get there one day. But it will take some time before electric vehicles can be popular here in Nigeria.