Investing in Africa – funds at a glance
Africa is not exactly known for the origins of automakers. Recently, however, a young auto industry has developed Afrika fonds investieren. The aim of the local automobile manufacturers is to manufacture African products for the African market. Politicians strongly support these projects. They help shift added value to Africa. In this post we introduce you to four African automakers that you have to know.
The African car market is comparatively small. According to Deloitte , only 44 out of 1,000 Africans own a car. The global average is 180 out of 1,000 people. About 1.55 million new cars were sold in Africa in 2015. According to the sales trend, this number can rise to up to 10 million new vehicles within the next 15 years.
There is relatively little disposable income on the African continent and the cost of new vehicles is high. This is why used cars dominate the market, continues Deloitte. It is estimated that around 80% of cars in Africa are used cars. These are usually imported. Most of the cars come from the USA, followed by Europe and Japan.
Egypt, Algeria, Morocco and South Africa already have a notable automotive sector. For example, VW produces the Polo model in South Africa and there is also a production facility in Rwanda . However, cars made in Africa only account for 0.9% of global production, according to Deloitte. The further development of the African automotive sector can have significant positive effects on the industrialization of the continent. African policy therefore gives high priority to the development of the automotive industry.
THE AFRICAN AUTO MARKET IS AN OPPORTUNITY TO CREATE SOMETHING NEW.
Mobius from Kenya – automaker with potential
Mobius Motos Ltd. is an East African automobile manufacturer based in the Kenyan city of Nairobi .
TO SOLVE THE PROBLEM
Mobius was founded in 2010 by the British Joel Jackson. While working for the Kenyan forest company Komaza , he became aware of a fundamental problem. Used cars from Asia are flooding the Kenyan auto market. The imported cars are not only expensive. They also do not get along well with the rather rough Kenyan road conditions.
Jackson wanted to solve this problem by making a car that would meet local needs – at competitive prices. The concept is based on a car that is as simply constructed as possible with a few extras. This keeps the costs low.
Mobius cooperates as far as possible is to optimize with local suppliers to the supply chain. This is challenging because there are only a small number of companies that can deliver the required quality.
CONCENTRATION ON A SIMPLE BASIC MODEL
After it was founded, Mobius Motors produced a prototype in 2011 , the Mobius I. Various investors have come on board. In 2014 another prototype was made, the first Mobius II, a 1.6-liter gasoline engine with 86 hp. Low fuel costs are an important selling point for the average African car buyer. The number of the Mobius II was 50.
The company is currently taking pre-orders for the new edition of the Mobius II. Production is scheduled to start in 2020. The price is affordable for many Kenyans. The entry-level model is expected to cost 1,300,000 Kenyan shillings (KES). That corresponds to around 10,100 euros. The new model will be available in three trim levels.
Mobius Motors has announced that it will diversify the utility value of the Mobius II with an expandable chassis . It would like to create possible uses for the transport of goods and people as well as an ambulance through various superstructures. Hybrid and electric versions are also planned. At the beginning of 2020, the automaker was manufacturing ventilators because of COVID-19 .
“MADE IN KENYA” AS A SALES ARGUMENT
In sales, Mobius also relies on the national pride of Kenyans. The Kenyan population is enthusiastic about the “Made in Kenya” car. The German sales manager Markus Schröder reported on the enthusiasm of the Kenyans when he is seen on the road with one of the prototypes. People ask him enthusiastically: “Oh, made in Kenya? I like your car. “
The name and logo of Mobius are based on the so-called Möbius strip. This is an infinite loop that was studied and described in greater detail by the German mathematician Möbius in the 19th century. At Mobius Motors it describes robustness, durability and longevity. These properties should also apply to the vehicles.
Mobius’ focus on Kenya as its main target market seems well chosen. Deloitte sees Kenya as well positioned due to a well-educated middle class, a progressive business environment and good regional market access . The country could develop into an East African automotive center.
The Kenyan government actively supports Mobius. From 2021, it will no longer be possible to import used vehicles into Kenya that are more than three years old, according to Reuters . In addition, local automakers are to be completely exempt from import duties and consumption taxes and their corporate tax rate is to be reduced by half. These measures are part of the government’s “Buy Kenya, Build Kenya” strategy .
design of new mobius II cars from africa mlc properties
Design of the new Mobius II, © Mobius Motors Ltd.
mobius II prototype 2014 car from kenya mlc properties
Construction of the Mobius II prototype from 2014, © Mobius Motors Ltd.
Kiira from Uganda – state-initiated auto industry
Kiira Motors Co. Ltd. is a company founded in 2014 in Uganda, East Africa, with headquarters in the capital Kampala . The company is 96% state-owned and 4% owned by Makerere University of Kampala.
EMERGING FROM A STUDENT DESIGN PROJECT
The company’s origins go back to a design project by students at Makerere University. In 2011 this resulted in the development of the first prototype, the Kiira EV , a small, cost-optimized electric car with two seats. A government initiative then led to the establishment of Kiira Motors Co. Ltd. in 2014. Other prototypes were the Kiira EV SMACK , the first hybrid car designed and built in Africa. A prototype of the Kayoola Solar Bus electric bus also followed .
MODERN PRODUCTION FACILITY
Kiira has started building a modern production facility in the Jinja district near the Ugandan capital Kampala. The plant will initially focus on the production of the Kayoola EVS electric bus . The capacity is initially given as 5,000 vehicles per year.
Here, Kiira is cooperating with the Chinese original equipment manufacturer (OEM) CHTC Motor Co. Ltd. , which is owned by the Chinese state. The company already operates several factories. The Kiira plant is also available for production by other automotive groups; Talks with the Indian car company Tata were held.
FOCUS ON OWN INNOVATION AND LOCAL SUPPLIERS
Kiira emphasizes that not only imported vehicle parts will be assembled in the new plant . The company is also interested in knowledge transfer and continues to work on developing its own vehicles. In addition, Kiira’s CEO Paul Isaac Musasizi would like to continuously expand the cooperation with local suppliers . For example, the local purchase of batteries, filters, seats, paintwork, body parts and marketing come into consideration. In addition, steel, lithium and copper from Uganda as well as banana fiber seats are to be processed.
Kiira’s flagship is the Kiira EVS (the “beast”), which so far only exists as a prototype. It’s a high-end hybrid vehicle priced at $ 25,000 to $ 35,000 each. Production does not take place in series, but on an order basis.
The Ugandan government has given Kiira a loan of USD 40 million. It also supports the Ugandan automobile project on another level: For example, it has decided to ban imports of used cars that are more than 15 years old.