Kenyan car manufacturing startup Mobius has gotten an undisclosed capital from American billionaire Ronald Lauder, which would help it deliver on its promise to produce Africa’s cheapest car.
The capital will be provided through the billionaire’s New York-based Pan African Investment Company (PIC), a company whose mission is mission is to identify, invest in and provide solutions that affect growth and development in sub-Saharan Africa.
“PIC is pleased to be working with Mobius to help create value in the company while driving job growth and entrepreneurism in Kenya,” said Dana Reed, the chief executive officer of PIC in a statement by Mobius Motors.
The deal will also see Reed serve on Mobius’ Board of Directors.
The capital offered by Lauder, whose worth is in excess of $3 billion is said to be in the form of a convertible debt (a type of loan issued by a company that can later be converted into equity or stock) and it is expected to finance the assembly of the first 50 units of Mobius II vehicles before the year ends and also the establishment of a distribution network.
According to the statement, several units of Mobius II have been pre-ordered and this has encouraged the carmaker to begin the concept development of its next-generation vehicle, Mobius III whose production launch is scheduled for 2016.
Kenya Vehicle Manufacturers (KVM), based in Thika, an industrial town in Kiambu County has been picked by Mobius to assemble the units.
“Mobius is re-imagining the car for Africa’s mass market and we are thrilled to gain the support of visionary investors such as PIC who see the social and commercial potential of our products across the continent” Founder & CEO of Mobius Motors, Joel Jackson said.
Devoid of features such as air conditioning and power steering Mobius II is targeted at rural Kenya with poor roads. Its carrying capacity, easy maintenance and efficient fuel consumption means it will be favoured for transportation.
According to the company, Mobius II will sell at Sh870,000 ($10,000), a price Jackson believes would appeal to business owners who need affordable transportation. New models in Kenya usually cost upwards of Sh2 million ($23,000). (VENTURES AFRICA)