Mobius Motors had a dream to build cars in Kenya, for Kenyans. They had the vision, they got the funding, then it all fell apart.
Founded in 2009 and incorporated in Kenya in 2010, Mobius Motors is a Kenyan based automaker backed by Playfair Capital of has made a voluntary decision to liquidate after efforts to save the company in the past years failed.
In August 5, 2024, Mobius Motors shareholders resolved to place the company under liquidation as per section 393(1) (B) of Kenya’s insolvency Act 2015. The notice issued by Director Nicolas Guibert, declared KVSK Sastry as the appointed liquidator. Kenya’s Insolvency Act 2015, allows companies to wind up if the board resolves “by special resolution that it be liquidated voluntarily.”
Mobius Motors Background and Vision
Mobius Motors was founded by British entrepreneur Joel Jackson in 2009. The vision of the company was to build a vehicle in Africa, for Africans. They aimed to address the need for durable and affordable vehicles suited for Africa’s bad roads. Mobius’ first model which was a stripped-down SUV model, Mobius I “built for African roads” was introduced in 2014. The Mobius I model cost $10,000 (KES 1.3 million), which is below the price of SUVs in Kenya.
Despite the innovations, Mobius struggled to capture a substantial market share.
Mobius Motors Funding Notable Investors
Mobius Motors raised a total $56 million in funding in 5 funding rounds.
Notable investors are:
- Kepple Africa
- AngelList Talent
- Chandaria Capital
- VestedWorld
- Playfair Capital
Mobius Motors Comprehensive Timeline: From Founding to Liquidation
2009: Joel Jackson, an internationally recognized entrepreneur recognized in the Forbes 30 under 30, founded Mobius Motors in 2009 with the vision to create vehicles specifically designed for Africa roads.
2010: Mobius Motors was incorporated in the United Kingdom and subsequently registered in Kenya in 2011
2014: Introduction of Mobius I, a stripped-down SUV priced at $10,000 (KES 1.3 million). Aimed at SMEs in the infrastructure, agribusiness, and supply sectors, the model encounters mixed reactions due to its minimalist design.
Mobius production has been based on pre-orders and by December 2014, delivery of 50 pre-ordered vehicles was set to begin.
2015: With backing from Playfair Capital, Mobius begins mass production. The company also released Mobius II, aiming to improve upon the initial model’s shortcomings.
2018: The company introduced Mobius II. The cost of building the Mobius II was Ksh 1.3 million, In October 2014, Mobius Motors launched the production model Mobius II (first generation) at a retail price of about ksh 1 million, a price that made it the most affordable new vehicle in Kenya.
Despite improvements, Mobius still struggled to compete with second-hand imports.
May 2018: In May 2018, Mobius received KSh500 million from the US government’s development finance institution Overseas Private Investment Corporation (OPIC) to set up a new factory in Nairobi. The loan was part of a KSh1.1 billion financing Mobius received from investors including New York-based PanAfrican Investment Co.
In 2018, the Kenya Revenue Authority (KRA) hit Mobius with a tax claim of Ksh 85.74 million based on assessments covering the period of January 2014 to December 2016.
2020: Mobius was saddled with a KES 649.2 million debt and a shareholder deficit of KES 389.1 million.
2021: Mobius III is launched, featuring more advanced features but priced higher, at Ksh 3.9 million ($34,000). The company faces difficulty capturing a market dominated by cheaper, used imports.
January 2021: Mobius opened a new Ksh 330 million manufacturing factory in Nairobi.
March 2021: Facing financial difficulties, Mobius seeks court protection from Kenya Revenue Authority’s tax demands of Sh73 million. The High Court grants a stay, provided Mobius offers a bank guarantee of Sh40 million.
March 2022: Mobius intends to scale up production of the Mobius II and is exploring expansion into regional markets such as Uganda and Tanzania. However, the company is challenged by growing competition from the rising prices of secondhand cars.
June 2022: Mobius collaborated with Rubis Energy Kenya to provide nationwide service centers for Mobius 3 vehicles. This partnership guarantees quality after-sales service and access to genuine parts for Mobius owners.
August 2024: Following years of financial difficulties, Mobius Motors opts for voluntary liquidation. Director Nicolas Guibert releases an official statement, appointing KVSK Sastry as the liquidator. A creditors’ meeting is set for August 15, 2024.
Our Opinion
From the story of Mobius Motors, it could be deduced that, the following factors contributed to the untimely death of Mobius Motors
1. Stiff Competition from Imported Cars: One of the biggest challenges Mobius Motors encountered was the intense competition from imported vehicles. The African car market is saturated with affordable and reliable used cars from countries like China, Japan and the UK, making it extremely difficult for a local automaker to secure a significant market share, even with a product designed specifically for local needs.
This is coupled with the fact that Africans view locally produced products as inferior.
2. Lack of Proper Government Support: Despite its potential, Mobius Motors may not have received the necessary level of government support to succeed.
3. Lack of Proper Government Support: Despite its potential, Mobius Motors may not have received the necessary level of government support to succeed.
4. Mobius Motors aimed to build affordable cars for local businesses. But they underestimated the power of the used car market.
5. Mobius struggled with unfavourable import policies and unexpected tax liabilities.
Conclusion
The voluntary liquidation of Mobius Motors marks the conclusion of a bold and pioneering effort in Kenya’s automotive industry. Despite its innovative and ambitious journey, the company ultimately fell to a combination of challenging factors.
Developing story
Mobius Motors avoids liquidation with takeover deal from an undisclosed buyer.
Read full story: Mobius Motors Takeover
