By Theodore Opara

Having achieved 65 percent local content in the production of automobiles, Nigeria’s leading vehicle manufacturer, Innoson Vehicle Manufacturers, IVM, has said that it is possible for the company to produce all components of automobiles, such as engine and transmission systems, if there is high demand for its products.

The Managing Director and Chief Executive Officer, Innoson Vehicle Manufacturers, Chief Innocent Chukwuma told Vanguard during a visit to the company’s assembly plant in Nnewi, Anambra State that: “We can produce engines if we can sell an average of 10,000 vehicles, annually. Presently the company sources engines and gearboxes from outside the country. 

According to him: “We source the components we use locally and import some. For example, we produce plastic components of vehicles like bumper, dashboard, front grille, among others, at our  Technical and Industrial Company Ltd, in Emene, Enugu State. We are in a position to buy any component that anybody can produce locally. We don’t need to import any of the items we can get in Nigeria. But we are still importing engine and gearboxes. The country they come from depends on the model we are producing at a given time. We don’t produce tyres but  we reach out to dealers and tell them what we want when the need arises. 

Continuing he said: “The local content used in our vehicles are not less than 65 per cent. When you package your business very well, it will grow in a short time. Somebody who has managed a business for 40 years, should be able to have grow.n it to an appreciable height” 

Chukwuma also made a case for starting businesses moderately to be able to maximise all the potential of growth.

He cited examples with his IVM saying: “Another important factor in growing a business, is starting very little. For instance, I didn’t start big like what we have today.  I started small, and grew it to what we have today,” he added.  

 Perhaps, the most interesting aspect of the chat was Chukwuma’s  story to stardom in the auto industry 

hear him: “What I am doing today in auto manufacturing, I had earlier done in the motorcycle industry. The time I joined the motorcycle business, there were five other companies, including Leventis dealing in Honda; Yamako dealing in Yamaha; Bolous Enterprises dealing in Suzuki; and CFAO dealing in Kawasaki and Moblet. I brought Jianshe motorcycles. I studied what the big companies were doing. They were bringing 36 units fully built motorcycles in one 40-feet container. But by the time they will do all the expenses on the 36 units,  their cost will become very high.

“As a shrewed businessman, before I joined, I calculated the cost and expenditure. Then,  motorcycle was N 150, 000 per unit, I calculated the component parts that make up one motorcycle and found out that the total cost was not up to N150,000. So I decided to go and import the motorcycles in components rather than the fully built.  I listed the parts and brought them in, and used local technicians to assemble them in Nnewi.  With my strategy, the same 40 feet container, could carry as much as 150 units as against the 36 units those companies were bringing in as fully built.”

That was the magic that brought down the price of my own motorcycle brand.

In fact, while they were selling at N150,000, my brand was going as low as N80,000 per motorcycle,. When customers found our brand to be equally good, the patronage trippled and we became leaders in the business we were supposed to be minors. We remained on top of the chart for about five years before others discovered what we were doing . 

However, having noticed that others were copying our strategy, we quickly designed other methods of making our prices cheaper. I opened a plastic factory in Enugu to produce the plastic components so that the price would be okay. When we started this component parts, our competitors started buying from us to couple and sell their brands. But by then we had dropped the price of one motorcycle down to N60, 000. 

 Those who bought my plastic components were also selling N60,000, but those who were not buying from me were selling higher.    Before I came into the business, people were only using second-hand motorcycles. because of the cost of new ones. But what I did made new motorcycles affordable and retired the tokunbor business. 

Armed with the success of the motorcycle business, I decided to venture into car manufacturing.