e-mobility in Africa
This article is a summary of a ClubHouse discussion organised on May 19th 2021. List of the Speakers at the end…
➡️ There are a lot of start-ups, developments and projects on-going in Africa related to e-mobility and electrification with a broad range of applications from cars to goods vehicles, e-bike, micro-mobility… e-Mobility is at very early stage and progress status depends on countries. In terms of technology, automotive economy and infrastructure, Africa is currently developing many things. For example:
Mobius Motors is a Kenyan car manufacturers
Megamillion is a South-African Megafactory for Batteries cells and Battery Packs for EVs
OX is a startup automotive company developing “transport-as-a-service” electric trucks
➡️ Southwestern Africa (Kenya, Zimbabwe, Rwanda, South Africa…) is slightly more advanced in e-mobility than the rest of Africa. Governments start exploring EV policies as a way to promote their own economy.
➡️ In Europe, EVs are promoted either as “sustainable” or as “hype” and pushed by government through incentives and bans. On the contrary, Africa’s approach is much more pragmatic and economically-driven: EV adoption will have to rely on demonstrating a value gain to people (either generating money, reducing painful commutes or simply linking point A to B). While in Europe EVs compete with petrol and Diesel cars, in some parts of Africa, EVs compete with bicycles, animals or even just walking, completely changing demands and acceptation criteria. For example, the cost of moving goods in Africa Is very high and can represent up to 50-75% of the retail price. Cutting transport cost might therefore be more important than range for multiple same day deliveries. Everything can be created here because we start from a blank page.
➡️ Africa is obviously very different from Western countries and gets its own specificities and sometimes “challenges”. Road infrastructure can be basic and there is a general lack of energy distribution infrastructure, be it for crude-based products or electricity. The argument of infrastructure development is therefore not an advantage for any type of vehicle.
➡️ Accordingly, Africa will surely have a very different business model from Europe. Shared mobility is already quite developed as any transport capacity needs to be fully exploited by combining people and goods to keep costs down. Battery Swapping for 2-wheelers or for very small vehicles can offer an interesting option. In Europe, customers will judge EV value mainly based on depreciation (how much money you "loose" over time of usage) while in Africa - in the hypothesis of a shared mobility - running cost and maintenance will predominate, which is beneficial for EV compared to crude-based cars.
➡️ EV adoption in Africa can rely on several scenarii: (1) Importation of old EVs from Europe. This is already an on-going business and some companies are even able to replace old Battery packs. (2) Conversion of engine-powered vehicles. For example, Opibus conversion costs 25,000 to 50,000$ which is nearly half of Capex that can be saved. (3) Purchase of new EVs which is today not common. Major OEMs rarely offer any model: for example in Kenya, you can only find Tesla or the VW e-Golf. But Chinese companies selling relatively cheap EVs are starting to spread in Africa, especially in countries with bilateral agreements.
➡️ In order to develop its transportation strategy (whatever it will be), Africa needs skilled Engineers. There are currently development at University and also thanks to online course on EVs.
➡️ Renewable energy has a massive potential in Africa thanks to solar and wind energy but also because Africa has a lot of major rivers able to host hydropower plants. As an example, 85% of electricity is renewable in Kenya.
➡️ Energy distribution and infrastructure remain a challenge but offer at the same time a true opportunity to leapfrog fuel quality and distribution development. Some countries (Kenya, for example) have already started to plan charger-deployment over the main country roads. A new eco-system needs to be developed offering a true synergy with the energetic development of Africa
Thanks to the Speakers:
Mahmoud Hermes, EV Product Manager at Opibus
Shantha Bloemen, Founder of Mobility for Africa
Simon Davis, Managing Director at OXdelivers
Geofrey Mutabazi, Funder at Charge Ko
