KENYA’S Mobius Motors, a pioneer in creating affordable and rugged SUVs for Africa’s challenging roads, has announced it will cease operations due to severe financial difficulties. The decision comes after a decade of efforts to provide low-cost, durable vehicles for the African market.
Founded by a London-born investor inspired by the continent’s rough terrains while working for a forestry company in Kenya, Mobius Motors was significantly affected by recent tax hikes in the country. These increases made the company’s business model unsustainable, to a shareholder who requested anonymity, told Reuters.
‘The business could not sustain itself. There were some challenges,’ the source said.
The company considered relocating its production facilities to another country. However, the logistical challenges of moving the assembly line from Nairobi proved too daunting, leading to the decision to shut down operations instead.
Mobius Motors initially gained attention with its basic, no-frills SUV priced at KSh1.3 million (about $13,000 at the time), roughly half the cost of an imported second-hand SUV. Over time, the company launched updated models with additional features to attract a wider market.
Despite its innovative approach, Mobius faced stiff competition from global automakers like Japan’s Toyota Motor Corp and Germany’s Volkswagen AG, which have increased their investments in markets like Kenya and Rwanda to capitalise on growing economies and rising consumer demand. Additionally, Mobius contended with competition from second-hand imports, a common challenge for local vehicle manufacturers across Africa.
Mobius Motors was part of a larger movement by investors and governments across Africa to create jobs and foster economic growth through home-grown vehicle manufacturing. This movement included companies like Uganda’s Kiira Motors, Ghana’s Kantanka, and Nigeria’s Innoson Motors.
However, the financial strain proved insurmountable for Mobius. The company announced that creditors would meet on August 15 to vote on voluntary liquidation. The announcement, which was not listed, appeared in newspapers, signalling the end of Mobius Motors’ operations.
The closure of Mobius Motors highlights the significant challenges faced by local vehicle manufacturers in Africa, including financial sustainability, competition from global brands, and the impact of economic policies such as tax increases. As Mobius Motors winds down, it leaves a legacy of innovation and ambition in the African automotive industry.
