Mobius Motors, a Kenyan vehicle manufacturer, is closing due to debt and high production costs.
The closure points to looming end of an era for locally manufactured affordable vehicles in Kenya.
Mobius Motors, renowned for producing affordable and durable vehicles tailored for the African market, has announced its closure following a shareholders’ meeting on August 5, 2024. The company struggled with mounting debt and high production costs, leading to this unfortunate decision.
Key challenges contributing to Mobius Motors’ financial troubles included:
High Production Costs where the expense of the local vehicle manufacturing exceeded expectations, mainly due to rising raw material and component prices.
Debt Accumulation which significantly accrued over the years leading to unsustainability.
Stiff Market Competition from both local and international car manufacturers eroded Mobius Motors’ market position.
Broader economic issues, such as inflation and fluctuating currency exchange rates, further strained the company’s finances.
This closure is a loss for the country’s automotive industry, which is home to several other notable car manufacturers and assemblers, including:
Kenya Vehicle Manufacturers (KVM) which assembles vehicles for brands like Hyundai, Volkswagen, and Peugeot. Isuzu East Africa that specializes in the assembly and distribution of commercial vehicles. Scania East Africa on the contrary focuses on premium buses, coaches, and trucks.
In addition, Associated Vehicle Assemblers (AVA) assembles vehicles for brands like Toyota, Hino, and Suzuki. Honda Motorcycle Kenya Ltd focusses on motorcycle assembly whereas KIBO Africa Limited manufactures motorcycles designed for the African terrains