here is something from west africa for now.
Fresh beginning for Nigeria's Auto Industry as Innoson Vehicles sets up new car manufacturing plant Once it begins, industrial revolutions rarely stop. There may be a decline in the relative importance of early centres of industrial growth and significant shifts in location. This can also be the story of what is happening in Nnewi, Anambra State, south east of Nigeria; it is gradual, but the industrialisation is steady.
And one of the companies that is hugely involved in the industrialisation of the area and Nigeria in general, is Innoson Group. The company's latest foray is in the area of auto manufacturing through its Innoson Vehicle Manufacturing (IVM) Company Limited. In no distance future, the company will launch its series of IVM vehicles into the Nigerian auto market. The unique thing about the vehicles is that they are wholly Nigerian made. All the parts and other raw materials are sourced locally except the engine blocks that are sourced from Toyota, China.
If the company finally pushes the vehicles into the market, which it hopes will crash the cost of vehicles in the country, it will make history of not only manufacturing world tested vehicles, but further mark the first time vehicles are manufactured locally in this part of the world. Presently, the company is manufacturing a 43-seater bus, 17-seater bus, an SUV (Jeep), pick-up trucks for various purposes, while the IVM saloon cars will soon be added in the production line.
The Chairman and Chief Executive Officer of Innoson Group, Chief Innocent Chukwuma told THISDAY in Nnewi last week that despite the fact that the vehicles are manufactured, the prices are going to be competitive and affordable. He intends to crash the cost of new vehicles in the country as he did few years ago when he crashed the cost of motor bikes when the price of the imported ones were getting astronomical for the common man on the street who needs it. At the end of the day, he said there would be no reason for one to go for second hand vehicles when he can afford new ones from the IVM range.
The journey for the Nigeria made vehicles by Innoson Vehicle Manufacturing Limited did not start yesterday. It is the fruit of a long term planning and huge infrastructural investment. Incorporated in February 2007, with head office and plant located in Akwa-Uru Village in Umudim, Nnewi in Anambra State, Innoson Vehicle Manufacturing Company, was established to produce a wide range of automotive products like cars, commercial buses, making use of substantial local input.
According to Chukwuma, when fully operational, the plant which is built in the collaboration of a consortium of Chinese auto-makers, is expected to produce other vehicles like trucks, pickup vans, tricycles and purpose-built vehicles like Police patrol vans, refuse collectors/compactors as well as sport utility vehicles (SUVs). Samples of the vehicles that rolled out of the plant were displayed at the recent Nnewi International Auto Trade Fair and the vehicles were highly commended by the Federal Government officials.
With an employment target of about 500 Nigerians and a sprinkle of Chinese expatriates, Innoson Vehicles Manufacturing Company Limited is expected to have an installed capacity for 10,000 vehicles per annum and a turnover of N30.4 billion. As the initial units displayed and test-driven in Nnewi last November are pointers to the foray, the IVM-badged vehicles will compare favourably with imported ones in terms of performance and durability, but will have the advantage of affordability owing largely to high level of local content.
The company's chairman said there is no doubt that Innoson is poised to replicate in the auto industry the revolution it set off in the motorcycle market some years back with the products from its Innoson Nigeria motorcycle plant in the same Nnewi.
Those who have followed the growth of IVM believe that the story of Innoson Group began with foresight, hardwork, perseverance and investment acumen of Chukwuma. They also said that it is about an investor who as a young man ventured into trading in tyres, motorcycle parts and accessories of mainly Honda brand, under the business name of Innoson Nigeria Limited in 1981.
With time, the company flourished remarkably and from being well known as leader in the business of motorcycles and accessories, the company launched into the importation of products from China. By 1990s, Innoson Group had become such a force that its products were dominating the market in all parts of the country and the West Africa sub-region with demand some times outstripping supply.
As a visionary investor and businessman, Chukwuma immediately realised that time was now to domesticate the production of motorcycles with substantial local input. Business watchers said the integration had attendant benefits of enhancing Innoson grip on the market and contributing positively to the development of the economy by way of technological transfer, employment opportunities and competitive pricing of motorcycles.
As the parent company, Innoson Technical and Industrial Company Limited later in 2002 veered into other lines of productions. Located in Emene, Enugu, Enugu State, the company engages in the manufacture of top-grade plastic products for household use, industrial applications and export.
Known formerly as Easter Plastics and owned by the old Anambra State government, the company was at the time of the acquisition by Innoson, derelict with obslete machinery. Chukwuma later reequipped the factory with modern machines and tools and transformed it into the biggest plastics company in Nigeria with products widely acclaimed to be among the best in the market. Presently, the company makes more than 60 plastics products with the list expanding every day.
Satisfied by the quality of the company's products, in 2008, the Standard Organisation of Nigeria (SON), at an elaborate event in its factory in Emene, presented the company with a MANCAP quality certificate after rigorous tests on some of its lines of products including the internationally acclaimed Innoson plastic chairs.
Innoson Group is bound to grow further when the General Tyres and Tubes Limited also located in Emene Industrial Layout, Enugu comes on stream in no distant future. When completed, the tyre factory will have the capacity to meet the nations motorcycle and motor tyres and tube needs. The company is being established in partnership with other Nigerian investors and Chinese technical partners. With this and other companies in the pipeline, Innoson has continued to grow into the country's formidable industrial giant with the presence in various vital productive sectors of the economy and affecting the lives of families across the country in various ways.
While Chukwuma expands his lines of business, he is asking government to grant the companies some incentives like tax reliefs. He said his companies are not getting any such relief from any government quarters.
Innoson Group, according to its chairman, may explore the stock market option. "But certain things has to be on ground before this move is made, he told THISDAY in his office in Emene, Enugu. Other companies like Cutix Plc and Adswitch Plc have adopted this approach. Chukwuma preferres to go public rather than use private placement for three main reasons. He wanted the shares to be marketable. He believes it would be easier to raise more funds in future.
According to a recent report, the United Nations Industrial Development Organisation (UNIDO), the World Bank Group (WBG) and the African Project Development Fund (APDF) are jointly mounting a program aimed at developing the Nnewi Automotive Industrial Cluster to a self-sustaining standard. This is a big boost to the industrialisation of Nnewi. Nnewi at present is the source of more than 80 per cent of motor spare parts trade in Nigeria (both for automotive and motorcycle).