Sylvia Duruson
Mobius Motors, a Kenyan-born vehicle manufacturer and assembler, is set to shut down its operations under the Insolvency Act. The company, which had secured $56 million across five funding rounds, has struggled to overcome financial challenges, hindering its ability to settle suppliers and pay salaries.
According to a notice seen by Techpoint Africa, a creditors’ meeting has been scheduled for August 15, 2024, at Mobius Factory in Nairobi, Kenya. The purpose of this meeting is to approve KVSK Sastry as the liquidator who will oversee the company’s wind-up process. The decision to enter voluntary liquidation was made after the company failed to rescue itself over the past year.
Nicolas Guibert, the Director of Mobius, stated in a notice that the shareholders had resolved to place the company under liquidation as per Section 393(1)(b) of the Insolvency Act and appoint KVSK Sastry as the liquidator to wind up the company.
Founded by British entrepreneur Joel Jackson and backed by the UK-based venture capital firm Playfair Capital, Mobius Motors had set out to produce low-priced SUVs targeting small and medium-sized enterprises (SMEs) in infrastructure, agribusiness, and supplies operating in remote areas. The company’s first model, launched in 2014, cost $10,000 (KES1.3 million), making it an affordable option compared to standard SUVs in the Kenyan market at the time.
However, the company’s business soon faced financial troubles as it struggled to capture the Kenyan car market, which was dominated by second-hand imports from the United Kingdom and several Asian countries. The subsequent release of Mobius II in 2018 and Mobius III in 2021 did not provide the much-needed boost to the company’s fortunes.
The news of Mobius Motors’ shutdown has sparked discussions about the impact of government policies on the mobility industry and the overall economy of East Africa’s largest economy, Kenya. The Insolvency Act of 2015 allows companies to voluntarily close shop if the board determines that it should be liquidated.
The list of creditors’ names and proxy forms will be available for inspection on August 9, 2024, at the company’s office, providing an opportunity for stakeholders to understand the extent of the company’s financial struggles.
Mobius Motors’ downfall serves as a cautionary tale for homegrown businesses in the East African region, highlighting the need for robust strategies, adaptability, and support from policymakers to navigate the competitive landscape and thrive in the long run.
