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Let’s clear up certain misconceptions.
- “Car manufacture,” like every other industrial process nowadays, is globalised. The days of having 20 different manufacturing processes turning raw inputs into finished output under one ceiling are long. long gone. Ever since global trade and comparative advantage became a thing after WW2, everyone from BMW to Boeing has integrated complex global supply chains and JIT (Just-In-Time) supply chain management, which means that the 777 Dreamliner Seun Kuti flies to his concerts in Europe and USA is “assembled” in Renton, Washington, after hundreds of parts are manufactured through a complex series of outsourcing agreements with subcontractors across Europe and Asia. To say that Boeing “does not manufacture aeroplanes” because for the most part, it does not actually make the parts of its planes would be a silly thing to say.
- There is a world of difference between what Innoson does and the CKD (Completely Knocked Down) and SKD (Semi Knocked Down) assembly operations that the likes of VW and Peugeot have run in Nigeria before. For one thing, roughly 65% of IVM parts are sourced locally. All manufacturing processes involving plastic, rubber, electronics and frame moulding are carried out at and within a 100KM radius of IVM’s Nnewi factory. An example of this is Union Auto Manufacturing, a subsidiary of @IbetoGroup, which manufactures the batteries used in IVM cars. Another example is Innoson Technical Co, a subsidiary of Innoson Group, which manufactures all plastic, rubber, foam and upholstery components used in IVM cars. The only parts of IVM vehicles that are imported are the engine blocks and other steel components – because Nigeria lacks the required steel smelting capacity.
- Ownership of manufacturing operations in 2024 is not determined by where specific production processes happen, but by WHO OWNS THE INTELLECTUAL PROPERTY. I’m a project manager at a company that makes solar PV hardware. Like most UK product builders, we ideate, plan, design, and manage end-to-end from our location in Britain, but the actual manufacturing is outsourced to a supplier in Shenzhen. Claiming that the UK consequently “does not manufacture” solar PVs would be asinine, because WE OWN ALL THE IP. Innoson owns the IP rights to their vehicles, which is an entire world away from simply assembling VWs and Peugeots. Equating one to the other shows how much Seun Kuti does not understand how things work, despite his desperation to be heard.
- IVM does not “assemble Nissan cars.” First of all, IVM has no “license” or agreement whatsoever with Nissan. Seun Kuti pulled something entirely out of his ass – not for the first time. Now IVM *does* have IP agreements with a basket of Chinese carmakers including @baicglobal and @DFM_Corporation, but these are IP agreements, NOT supplier licenses. An automotive IP agreement means that you are given access to the designs and schematics of a vehicle by its manufacturer, and you are allowed to reproduce it under your brand name. It basically allows one to venture into vehicle manufacturing without having to reinvent the wheel, and it is exactly how China grew its automotive industry from negligible in 1985 into the world’s largest in 2023.
It is NOT the same thing as importing CKD or SKD vehicles to assemble.
Again as I keep saying, I really wish that Nigerian men (it is always men!) would be less obsessive about opening their mouths and making their voices heard, and more concerned with the quality of what comes shooting out of their mouths. It’s really not compulsory to speak, especially on things one has zero or half-knowledge on.
We should learn to shut up occasionally ! It’s a life skill!
By David Hundeyin
