Mobius Motors, the ambitious Kenyan automaker that aimed to revolutionize the local automotive industry, has announced it is going into liquidation. The decision, confirmed by Mobius’s Director Nicolas Guibert through a creditors’ voluntary insolvency notice, marks the end of an era for the company that sought to provide affordable, rugged vehicles designed for the African market.
The Liquidation Process
The announcement was made on Monday following a stakeholder meeting. Guibert stated that KVSK Sastry has been appointed to oversee the liquidation process. “At a meeting of the shareholders held on 5-Aug-2024, it was resolved to place the company under liquidation as per Section 393(1) (b) of the Insolvency Act and to appoint KVSK Sastry as the liquidator to wind up the company,” read the notice.
Liquidation involves bringing a business to an end and distributing its assets to claimants. It occurs when a company is insolvent and cannot pay its debts. During this process, the remaining company assets are used to pay creditors and shareholders based on the priority of their claims. A list of creditors and proxy forms will be available for inspection on Friday, August 9, at Mobius’s head office at the Sameer Business Park in Nairobi.
The Rise and Fall of Mobius Motors
Mobius Motors was founded by British entrepreneur Joel Jackson, with the vision of producing affordable, robust vehicles tailored for the African market. The company unveiled its first model, the Mobius I, in 2014. The compact SUV was designed to tackle the rough terrains common in many parts of Kenya and other African countries. However, it received mixed reactions from the public due to its stripped-down look and the initial price tag of Ksh.1.3 million.
Despite the lukewarm reception, Mobius Motors continued to innovate and introduced subsequent models, including the Mobius II and Mobius III. These models featured enhanced designs and more features while maintaining their ruggedness. Priced at Ksh.1.5 million and Ksh.3.9 million respectively as of 2022, these vehicles aimed to capture a larger market share and establish Mobius as a significant player in the local automotive industry.
Challenges in the Kenyan Car Market
The Kenyan car market is predominantly dominated by used imports from Japan. Efforts by the government to boost local vehicle assembly have attracted investments from global automakers such as Volkswagen. However, the sale of new vehicles in Kenya has faced significant challenges. Last year, new vehicle sales dipped by 15 percent, with individuals and businesses purchasing 11,370 units in 2023, down from 13,352 units in 2022, according to data from the Kenya Motor Industry Association.
Dealers have attributed the decline to high inflation and the depreciating shilling, which have increased the prices of products and production costs. These economic factors have made it difficult for local manufacturers like Mobius Motors to compete with cheaper, imported used cars, further straining their financial viability.
Conclusion
The liquidation of Mobius Motors underscores the challenges faced by local automakers in a market dominated by imported used vehicles and plagued by economic instability. While Mobius Motors had a commendable vision of providing affordable, durable vehicles for the African market, economic realities and market preferences proved to be significant hurdles.
As the company winds down its operations, it serves as a poignant reminder of the need for continued support and strategic initiatives to nurture local manufacturing industries. The government and stakeholders must address the underlying economic challenges to create a more conducive environment for local automotive companies to thrive. The end of Mobius Motors marks the conclusion of a chapter in Kenya’s automotive industry, but it also presents an opportunity to reflect and strategize for a more sustainable future.
