Troubled Mobius finds mystery rescuer in boost to local industry

Mobius Motors has said that it has entered into a deal with an undisclosed buyer, saving the local motor vehicle from closure.

The company had last week said its shareholders had agreed to put the company under liquidation and appoint KVSK Sastry as the liquidator to wind up the company. It had gone on to invite creditors for a meeting that was scheduled to take place on Thursday, August 15.

On Thursday, however, the firm announced that it had accepted a bid from an unnamed buyer and informed the creditors that the meeting would take place at a later date.

“On August 14, 2024, Mobius Motors accepted a bid for 100 per cent of its share by an undisclosed buyer. Both parties are looking to close the transaction within 30 days,” said Mobius’ director Nicolas Guibert.

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“As such, notice is hereby given that the meeting of creditors originally scheduled for August 15 at 9am at Mobius factory has been postponed to a date that will be communicated in due course.”

The firm started production of the Mobius vehicle 13 years ago, aiming to capture the local market with a low-cost rugged SUV, customised to local conditions including rough roads.

It had started local assembly by outsourcing its vehicle assembly function to Thika-based Kenya Vehicle Manufacturers but later commissioned its own assembly plant at Nairobi’s industrial area.

Its first model, which hit the market in 2014, retailed at about Sh1 million. Later models, which had more features cost Sh1.5 million while Mobius III produced in 2022 cost Sh3.9 million, significantly lower than second-hand imports with similar capabilities.

Mobius expected that by designing a vehicle that would handle local roads and priced relatively cheaper, it would lure Kenyans from buying imported second-hand cars. 

It however failed to make inroads despite what appeared to be a huge local market.

Kenya imports the bulk of the vehicles that are used on local roads. In 2023, the number of newly registered vehicles – excluding motorcycles - reached 119,205, according to data from the Kenya National Bureau of Standards. 

Of these new vehicles, only 10 per cent or 13,106 units were assembled in Kenya.

The local assembly industry has in recent years made some progress and posted steady growth as more firms have been setting up local operations. 

Hacking the local market would have also served as a springboard to the region, where there is also little local assembly of vehicles and the market relies on imports.