Kenyan automotive startup Mobius Motors has announced its closure after a decade-long attempt to disrupt the local car market.
The company, known for its rugged, low-cost SUVs designed for Africa’s challenging roads, has been having financial difficulties that ultimately led to its shutdown.
This is despite raising $56 million in funding from investors including Playfair Capital, Chandaria Industries, the US government’s Development Finance Corporation (DFC), and PanAfrican Investment.
Founded in 2009 by British investor Joel Jackson, Mobius aimed to provide affordable and durable vehicles for the African market. Its flagship model, a no-frills SUV, was priced lower than imported second-hand vehicles, a common choice for many African consumers.
Despite the initial goal, the company faced several challenges including the Kenyan government’s introduction of new taxes that eroded Mobius’ competitive advantage, making its vehicles less affordable.
The company aimed to provide affordable vehicles for small and medium enterprises in sectors like infrastructure and agribusiness, but it faced intense competition from cheaper second-hand imports from countries like the UK and Japan.
Mobius initially launched a basic SUV model priced at $10,000 (approximately KES 1.3 million), a fraction of the cost of standard SUVs in Kenya. While it released updated models, Mobius II and Mobius III, in 2018 and 2021, the company failed to gain traction in the market.
Mobius Motors had linked its production to pre-orders, requiring a refundable deposit of $384 (KES 50,000), which likely limited the uptake of its vehicles. Attempts to relocate production outside Kenya were dismissed due to logistical challenges.
In a statement, Mobius director Nicolas Guibert announced the company’s decision to enter voluntary liquidation. Creditors are set to meet on August 15th to discuss the distribution of assets.
Mobius’ mission to produce home-grown vehicles in Africa, a sector that has seen increased investment from both local initiatives and global automakers like Toyota and Volkswagen, has come to an end.
These companies, too, face the challenge of competing against the influx of second-hand imports in the region.
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