ecently the Nigerian Government said that they are considering banning the importation of vehicles into the country. It was the president that hinted this in a speech, and the minister followed the next day with revelations of already approved import duty increases on tokumbo vehicles, with the goal of phasing out vehicle importation altogether. They wish to revitalize vehicle manufacturing in Nigeria, and have plans to go and talk to Toyota and others to come and manufacture in Nigeria. Tory! Well, all these set my mind going; I remember that I have seen a few made in Nigeria vehicles, all by Innoson…a vehicle manufacturing company based at Nnewi. I wanted to know how viable this company really is, and if this could be part of the answers to Nigeria's many questions. I wanted to see things for myself; I called a good friend of mine from Nnewi, who happened to be the chairman of Nnewi North Local Government. He made the necessary calls and when I arrived at the company's gate the next day, was given a tour of their vehicle manufacturing plant.
A friend of mine once told me that God cannot threaten him with hell fire since he already lives in Nigeria, which is hell on earth. Perhaps I won't go that far, but I understood where my friend was coming from. One is often reminded of hell through flashes of anguish that exists in Nigeria. Even the so called "big man" in his opulent mansion and chauffer driven Range Rover and police escort and silent generator is often driven mad by the constant on and off NEPA magic. There is a whole lot that is going wrong in Nigeria today, and people like me have spent valuable time criticizing our government for all their failures. And in my opinion, it is the right thing to do if we must get this democracy right someday. But as one of my readers reminded me recently in appreciation of an uplifting article I had written, we criticize a lot, and never take out time to smell the roses. I have since resolved, in addition, to highlight all the good things I see around me here in Nigeria, especially those worthy of mention.
Hence after a two-hour-drive from Enugu I arrived Innoson factory in Nnewi at about 10 AM Saturday morning. Boy! Was I pleasantly surprised? I had come, expecting to see an assembly plant where parts are simply coupled together as had been the case at Mercedes assembly plant in Enugu, or at the Volkswagen plant in Lagos, or the Peugeot plant in Kaduna all back in the seventies and early eighties. But I should have known better, that things have long changed, that even the so called "manufactured in America" or Japan, is not what it's cracked up to be. In my MBA class back in 1988 we did a case study to examine the source of the components in a typical American car. Our case study was on Pontiac Lemans, an all-American car back then. We found out that only 22% of its components were manufactured in America while the remaining 78% came from more than fifty countries. Even the finished product was put together in Canada, yet it was regarded as all American. Our findings were later published by the Wall Street Journal and created a lot of headlines elsewhere.
An assembly plant is what I came to see at Nnewi, instead I was shocked at the things I witnessed. Several Nigerian ministers including our current minister of information have visited there, so what I am about to describe is not a secret to the powers that be in Nigeria. The factory is also only a 2-minute-drive from Ojukwu's house where President Jonathan visited during his burial. I thought he should have seen this factory by himself since he got that close. Incidentally, Innoson has several factories at Nnewi and elsewhere, including one at Emene in Enugu where they manufacture vehicle seats, tires, and plastic chairs that are the most used in the Southeast by churches and at functions. Another plant at Nnewi manufactures motorcycles, and yet another one solely dedicated for the manufacture of motor parts. I had been to the Enugu factory on a previous occasion and upon my visit at Nnewi concentrated on the vehicle manufacturing plant.
The company makes about 20 different models within their vehicle section. They range from 40-seater fully air-conditioned city buses to 12-seater vans, from heavy duty trash compactors to pick-up trucks, from ultra-modern coaster buses to small cars. I even saw some heavy duty tow trucks, but what really caught my attention more than anything else was their IVM G5, a sports utility vehicle, or what Nigerians refer to as Jeep. I did not take their word for it, but decided to test drive this Jeep to see and feel how it compares with the Toyota Prado jeep, which happens to be the standard vehicle for most politicians in Nigeria. Even if they sit in their armored Range Rover, G Wagon Mercedes, or Landcruser, you'd always see a handful of Prado Jeep in their convoy. And here is a vehicle, totally made in Nigeria by innoson, which performs favorably to the Prado, yet sells at a much lower price. The retail price for the Innoson jeep is about 3.7 million naira, about half the retail price of a Prado jeep.
I saw numerous Chinese and Korean factory workers along with their Nigerian counterparts as they constructed vehicles from nothing. I witnessed the various stages of making these vehicles, from the frames to their finishing. I was astonished, and never believed what I had witnessed, so much that I had the utmost difficulty restraining my tears of joy. How is it possible that this sort of vehicle production is going on in Nigeria, and our leaders are focused more on going to beg Toyota and others to come and manufacture in Nigeria. Most of the big city buses in Enugu today are innoson vehicles, and most of their trash compactors are also made by Innoson. Recently the government of Anambra state gave out over two hundred Innoson jeeps to various chiefs, and I believe the five hundred buses recently donated by Peter Obi to various Anambra schools were also made by Innoson. But outside of these two states, there are hardly any tangible orders by any other state or federal government.
I did not get the opportunity to talk to the owner to find out if the company had indeed received any tangible grants from Nigerian Government. The company seems to have their act together, but I saw some limitations, they still have to refit their production line on a weekly basis depending on what vehicle they are building that week. As a consequence they are limited on the number of vehicles they can make in a day. Currently I understand that they are making just about ten vehicles per day, a very pitiful number if they must compete with the big boys like Toyota and Honda who seem to dominate the Nigerian market. This is where the Nigerian Government is supposed to come in with billions of dollars in grants or partnership to take such a company to a different level, and in the process create hundreds of thousands of jobs and save the billions of dollars that would otherwise be used to import those cars. No, they won't do that, instead they are busy chasing Toyota and other foreign firms around, presumably to lure them in with incentives that would definitely run into billions of dollars.
What Innoson is doing is not entirely new in Nigeria. In the seventies, great visionaries like Sir Joe Nwankwu of Abagana built many great factories, at a point I counted eighteen of his factories that manufactured varieties of products. He was not alone then, men like Mr. Anahara (Ferdinand Enterprises) and others build giant factories. The Yorubas had many such men that built humongous factories at Isolo and elsewhere. Even in the North, the Housas built garment and other factories that could rival any in the world, but through the recklessness and lack of focus on the part of our leaders, many of these factories died a slow and painful death. Today, I see in Innoson, a new awakening, a bold beginning in our quest for industrialization. I am absolutely certain that Innoson is not alone; he may be the only one making cars in Nigeria today, but there are countless new factories popping up at various locations in all zones of this country. Sadly, our political leaders are busy fighting over power, security votes, and constituency allowances to notice these factories. Should these factories die again like those that came up in the seventies; their collective blood will be in your hands.
China, India, Brazil, and other developing markets did everything to protect and grow their local firms. If only you know the billions of grants Hundai received from the South Korean Government during their developing years. Today, it is among the car of choice for many government officials in Nigeria. Why are they not driving Innoson vehicles today? For many years, India limited their government employees to driving TATA, a laughing stock then. Today, TATA now owns Jaguar and Range Rover among others. Toyota and Honda were once part of a laughing stock in my lifetime. Today, they are among the gold standards in the world. If our governments don't nurture the Innosons of Nigeria today, they may never amount to anything serious tomorrow. Even in developed countries like America and Britain; their public sectors such as the local police departments are limited to buying domestic cars, as a way of promoting and supporting local companies. Why can't we do that in Nigeria as a starter?
Incidentally, this new awakening by our government to barn tokumbo is not out of the need to protect our domestic manufacturers. Car importation has become a huge drain on Nigeria's foreign reserve, accounting for several billion dollars each year. Recently, there was a squeeze on the ability of our government to meet our foreign obligation on the dollar, and in panic they are now banning everything from the importation of dollar to even collecting money sent by Western Union in foreign currency. Incidentally, it is the same politicians, who have resorted to using the dollar after our Central Bank cashless policy kicked in. They succeeded in dollarizing the economy, and our government is now panicking that they cannot meet their obligations. Governor Amaechi and others have accused the federal government of being broke and unable to pay their bills. Okonjo-Iweala, the finance minister went on television to rebut the claims. The truth is that our government is facing some monetary pressures and the sooner they focus on empowering the private sector the better.
Finally, whatever the case, I am encouraged by what I saw at Nnewi last Saturday, and hope that our governments at various levels should support and encourage such bold entrepreneurs if we must have a sound economic future in this country. To me anyone who starts a business in Nigeria that can employ upwards of two thousand Nigerians is far more valuable to this country than a minister.