Nigeria’s automotive policy good but failing –Onyishi, PMT boss

Magnus Eze, Enugu

From a humble beginning, foremost transporter, Dr. Sam Maduka Onyishi, rose from a mere bus conductor, bus driver and motor spare parts dealer to become a university graduate; a successful entrepreneur, accomplished businessman and philanthropist of note.

The Chairman/Chief Executive Officer of Peace Mass Transit Limited and also, Chairman of Peace Mass Transit Beijing Trade Ltd, Beijing, China, spoke on his business experience.

Onyishi, who recently, commenced construction of Nigeria’s first wholly entrepreneurial university, talked on the challenges of transport business in Nigeria; diversification, border closure and Nigerian automotive policy among other issues.

Challenge of moving over 30,000 passengers with over 2,000 buses daily. How  do you sleep?

Yes I find time to sleep. I don’t drive the buses, but just a manager. I have so many people assisting me. However, when God gives you a job, he gives you the resources for it. For instance, I was a bus conductor. I was a bus driver. I was a spare parts dealer. I went through the elementary school of transportation. So, that is how we are able to get to where we are today. It’s not easy but I enjoy doing it because I was really groomed for this business.

Advice to aspiring Transportation entrepreneurs

I will advise him to look for another business. The reasons are very simple. If you want to operate on our scale, then you are in trouble because you are going to buy new buses and you are going to be competing with people who are using tokunbo (fairly used) vehicles. You will buy brand new tyres and you are going to compete with people who are using tokunbo tyres. All the money you will make will end up in spare parts; and in trying to replace your new vehicles. If you want to operate on our scale, you cannot use tokunbo but the people who are competing with us are using tokunbo; so, we are left with nothing. You buy a vehicle for N26 million and you are competing with people who buy vehicle of N1million and 90 per cent of the passengers are just interested in the fares, only about 10 per cent are interested in quality.

And those up there who can pay much more would rather fly than use the road because of the condition of our roads.

How to do transportation business on dilapidated road network

That’s what I’m advising that aspiring entrepreneurs should look for another business. You asked what advice I will give the person and I just told you. As I’m doing this, I’m not praying for any of my children to come and sit on my seat. If any of them wants to do the transport business, so be it, but for me to bring them to come and do transport, no way. That will be going through the same punishment twice.

Criticism that Igbo businessmen don’t live long

We have a culture where everybody wants to own his own and most of us are traders; people only serve their masters and are ready to open their own and begin to compete with their masters. When their masters make money, they send their children to schools abroad. For me now, I’m a transporter; you may want your children to be medical doctors, lawyers and so on. Only a few will have interest in that trade through which their school fees were paid. So, how is it going to be sustained when the children are not trained to key into the business?

However, those who studied business management can come back to do it. For instance, if an Igbo man who made money selling palm produce and the children grew up and they are now medical doctors, engineers, architects and the rest of them. Tell me what business they have with palm oil? But if the children could grow up and study agriculture; they may go into food processing or something similar and key in and enhance the business to another level. But when they go and study courses that are not related to what their father was into, they will not be able to do that business. Of course, they are moving far away from the business and after going to University abroad, they will find it difficult to go to the farm to meet with women who carry palm oil.

Running sustainable business

The Igbos are majorly in commerce and prior to this period, it was difficult for those in commerce to compete with multinationals. When you do small business and try to bring in people and to go PLC and all that; are you going to compete with the Chinese products which have killed the Igbo man’s business?

So a lot of us have ended up becoming traders. So, when you get the money, either by taking equity or the rest of them, it will be difficult. So, you need to be in big business before you start looking for the money to run it. You don’t just go to the market because you want to. When you go to the market and get the money, what are you going to do with it? I think it’s all about getting the right information and opportunities that are open and also the environment. It’s just recently that the government started creating opportunities for people to do this kind of businesses. If you watch, you discover that most people who have made money in big business are those that have access to government and then one government policy or the other will favour them and they come out and make some huge money.

Ordinarily, apart from the banking industry, which other sector has made progress; is it the manufacturing?

In the past 30 years for instance, which other industry has made progress? It is either the multinationals or the banking industry. And when you look at companies like PZ, Coca-Cola; Nigerian Breweries and so on, the profit made by one bank will overrun what four to five of these companies make in one year. And these are people that have been in the business for much longer.

So, are you saying that we now have an import dependent economy?

That is what I’m saying. People will easily say, he has not done this; he has not done that, but under what environment? Can you compete with these people without power? By the time your goods are even coming in, your demurrage in the wharf would have taken all the profit you are supposed to make . And you are competing with Chinese and other businesses from other countries who are taking loans at 3 or 4 per cent to run businesses and you are taking loan at sometimes 30 per cent and somebody is expecting you to make profit. Which profit are you going to make. In fact  you will just end up working for the banks. That is why the banks are making more money than any other industry in the last 30 years.

How has government’s automotive policy helped Nigerian businessmen

Yes, the government has an automotive policy but are we enjoying it? No. They just told me that one trailer to carry my container from Lagos to this place is N1.3million.

And  so, all the money I’m supposed to make from the SKD has gone on transportation. But if I bought a fully built bus, the bus will just be removed from the ship and the driver will drive from Lagos it to this place (Enugu). I will only buy say N30,000 fuel. But I’m paying N1.3million. And when it comes back here, I will pay for the cost of assembling. So, the profit that I’m supposed to make has gone to the trailer drivers.

Where’s the automotive policy? The automotive policy cannot work under this present port condition because of high demurrage cost.

Can activation of Eastern ports tackle this challenge

Yes, if the Onne port starts working effectively, that will be better. But for you to ship your goods to Onne, you are going to pay extra 800 dollars per container; so, you are paying around N300,000 per container; meaning that it’s easier to get a vessel from the Tin Can Island port than from Onne.

So, you go to Onne, you pay extra 800 to 1000 dollars, you go to Lagos, you pay extra 1000-1,200 dollars to the trucker. So, there are barriers everywhere. These are hindrances that are not known to the outsider. However, the automotive policy is supposed to be a very good one but it is not because the infrastructure is not supporting the policy.

Diversification

I’m into lubricants but this is the one I’m running. I have other businesses but I am running Peace Mass Transit by myself. Other businesses are run by other people, so, I don’t bank on them. I’m not saying they are not doing well but I’m not relying on them. This is the one I focus more on. Though they all belong me, my main preoccupation is transportation business

How border closure affects my business

I think it’s an interesting development especially for the agricultural sector. You can be bringing food from other countries and other people are taking everything and we are just consuming. We have to take part of the duties paid on imported goods and I believe

we have to produce what we consume too. I think the border closure is a very good policy But it has to be balanced because we also produce and export things that other people buy too. If they want to bring in things, let them bring that through legitimate means. There is nothing wrong with bringing in goods from Ghana or Cameroon or from all over but they must come in through legitimate means; so that people who are doing business here can compete without being put under by anybody. They should not be disadvantaged by anybody in doing business in their own country.

Are you into farming project o

No, not at all.

May be in the near future but not at the moment; however, agriculture is a good business because it’s an essential service, like transport or health; these are things you cannot do without.

About 25 years ago, the founder of Ekene Dili Chukwu Motors, Chief Augustine Ilodibe told us that the worst mistake he made in life was going into agriculture, especially, poultry with his Austin Farms…

That’s what I am talking about, because he wasn’t a professional; he didn’t understand it. My advice is venture into where you understand; don’t go into a business because everybody is going into it. Remain in that area you understand.

Nigeria is a very nice place to invest. This current government is actually doing something. The current effort or posture of government is going to be a refreshing thing to business and that is good. And when opportunities are created, jobs are created, security improves and it’s like that; one thing leads to another and it goes round.

Unemployment is a major issue here. It is the cause of insecurity. The more there is unemployment, the more there is insecurity and this makes even the people who are employed to be insecure running their businesses. We can only get better.