Does Innoson Manufacture Or Just Assemble Cars?

Does Innoson Manufacture Or Just Assemble Cars?

I came across a post this morning where the poster claimed to have worked at BMW and believed he was in the right position to tell us which car companies in the world are manufacturing companies and which are assembly companies. I was reading to understand the difference, but he didn’t provide any meaningful information. He rushed to list Innoson and other companies as car assembly companies, while listing Mercedes Benz and BMW and other companies as car manufacturing companies.

His reasoning was that Innoson imports some of its car components and assembles them, while Mercedes Benz and BMW manufacture all their car components from scratch. I immediately knew that the man didn’t know anything about car manufacturing and had never been to Innoson car plant before.

To start with, Innoson Vehicle Manufacturer (IVM) is a well-known Nigerian-owned producer of different vehicle brands. The company has its manufacturing plant in Nnewi, Anambra state. 70% of their car parts are produced locally, while the rest are imported from Japan, China, and Germany.

As I mentioned earlier, the man arguing that Innoson is just an “assembler” based his arguments on the fact that Innoson sources some of the components of its vehicles from external suppliers, mostly from China.

Now, let’s take a look at the profiles of some world-renowned automakers.

Benz-Daimler AG is a German car manufacturer with its headquarters in Stuttgart, Germany. The company produces the Mercedes-Benz auto brands. To produce Mercedes-Benz cars, Benz-Daimlers rely on over 100 suppliers of Benz parts worldwide.

Some principal suppliers of Mercedes-Benz parts include Thyssenkrupp (Germany), Eagle Ottawa (USA), Inteva Products (USA), Carcoustics (Netherlands), Nemak (Mexico), Johnson Electric (Hong Kong), and ZF Lenksysteme (Germany), etc.

Now, let’s profile another top auto-brand: Rolls-Royce.

Rolls-Royce is a prestigious British auto-brand with its factory in Sussex, England, United Kingdom. To produce a Rolls-Royce car, only 8% of the parts are produced in the UK. The company imports roughly 32,000 parts from more than 600 global suppliers to build its vehicles.

BMW sources most of its car components from various suppliers across the globe. Some principal suppliers of BMW parts include:

Thyssenkrupp (Germany), Eagle Ottawa (USA), Inteva Products (USA), Carcoustics (Netherlands), Nemak (Mexico), Johnson Electric (Hong Kong)
ZF Lenksysteme (Germany).

These are just a few examples, but BMW relies on a network of suppliers worldwide for its car components.

With these examples, how do we classify Innoson Vehicle Manufacturing? Is it simply an “assembler”?