Is Africa ready for electric vehicles?

Dr Mandla Lamba

This Mail & Guardian webinar was sponsored by Agilitee Africa. It featured as its speakers Dr Mandla Lamba, CEO of Agilitee Africa; Kriekie Du Plessis, Chairwoman of Agilitee Africa; and Avon Middleton, Publisher of TopGear Magazine South Africa. It was moderated by award-winning Broadcaster Oliver Dickson.

Dickson: Mandla, please tell us where Agilitee is now?

Lamba: We started off as Agilitee, but now the company has spread across the world. There are partnerships with Absa and Capitec. We are the first EV company in South Africa; we recently closed a deal with GridCars that will enable us to build our own charging points, which will make us the single biggest EV operator in the country.

We have partnerships with Indian company EbikeGo and with other local companies. I also own a company called Verityhurst; I want to list Agilitee on the JSE; I own 34% of the company.

What is the product offering that you have at the moment?

We have the Wild Grace motorbike, which is a personal commuting vehicle and retails for R135 000; we have the LoadEX, which is a delivery scooter, which retails for R35 000; there’s the student cycle called Return to Freedom or RTF. There was supposed to be a fourth vehicle, but we were hit by the Covid-19 pandemic and lockdown; this one is the Agilitee Somizi.

Avon, what are your thoughts on consumers being wary of entering this new market, but with such low prices, they might be attracted?

Middleton: The EV landscape is something consumers definitely have anxiety about. It’s an unsupported industry at present. There are worries about load-shedding. Petrol vehicles are better at the moment. The media has a role to play in letting consumers know that EVs are okay, and they have many benefits. Pricing is key, and Agilitee is able to offer products at a good price, which is key for small companies hit by Covid-19.

Tell us about the four franchises, where charging and battery swapping can take place?

Du Plessis: The first one is Agilitee Expand for the national footprint, which is like a normal dealership where you can buy scooters and cars; the second one is Agilitee Express, which will be in shopping centres and urban areas; the third one is Agilitee Mini X, for rural areas. This is an exciting container concept, where you can charge bikes, plus there will be internet, a coffee shop, and you can rent or buy the bikes. There will be training for the sales staff, and some franchise facilities will be training grounds. Safety is a top priority, but the electric scooters are much easier and lighter to drive than petrol vehicles. We are excited, this is a first in the motor industry. All South Africans can become entrepreneurs, and this will aid mobility, which is a right, not a privilege. The fourth franchise is still a secret!

Does Absa provide financing for all the franchises?

Du Plessis: The Mini X starts at R250 000, the Express at about R500 000, and the Expand from R1.5-million, depending on the placement of the franchise. There’s a six-step application process franchisees have to follow; Absa will finance 50% for franchisees.

Is franchising an attractive option right now? People are not going to dealerships as much as they were.

Middleton: The retail market is changing. People used to visit dealerships and test cars; now they do a lot of that online, and dealerships deliver vehicles. But you still have to service your vehicle, so dealerships will still be around for a while. But people are still very slow to buy EVs; in 2020 there were only 100 sold, and this number has not gone up much this year. So these franchises look great as a future concept, but don’t look so good right now. EVs are a good option for big businesses, regarding buses and scooters, but consumers are still apprehensive about EVs at present.

Those people who are installing charging stations are anticipating making money only far into the future, maybe in five years, when there is mass adoption of EVs; isn’t that quite a fearful concept for franchise owners, and for you as a business owner?

Lamba: We will be receiving 50 charging stations soon, and the next 50 before Christmas. It is not easy for any industry if there is no government support for it. This is something that can generate income for the government in the long term. Agilitee has realised that this is a long-term thing, and it needs to build the infrastructure as well as sell the vehicles. We are praying that the national government comes on board, but we have the funds and the patience to wait. We are hoping that as infrastructure is built, it will push adoption.

If I buy a franchise and can’t meet costs because of low sales, will there be support?

Du Plessis: We have had to adopt a new form of franchising, in the same way that technology is changing. Agilitee has a rent-to-buy option, and teams that will work with franchisees to help them meet their targets.

Lamba: We don’t sell vehicles; only the franchisees do. We have no doubt that we will succeed. We are the first company to swap batteries free of charge, which is an attractive option for a buyer, who no longer has to buy petrol. “I am positive that our model will suffice.”

Tell us about vendor finance, and other options for franchisees?

Lamba: We will look at each case on its merits. We built an Agilitee dealership ourselves in Cape Town, without waiting for financing, which can now be bought by a franchisee.

Who absorbs the cost of swapping batteries?

Agilitee pays a percentage of the cost. I believe that by 2026 there will be lots of people buying EV cars, and by 2030 there will be no more combustion engine cars. So if you come in early as a franchisee you will be smiling.

Will faster charging be possible in the future?

Middleton: Technology is progressing fast, and large companies are investing a lot of money into advancing charging technologies. I drove an EV recently that links to my smartphone, and it had so many options available, it was impressive. The EV space will advance as rapidly as our phones have. Right now you will get a wall-box to charge your EV; and there are questions about whether different car company chargers will work for other makes of cars. The stuff you see in movies is already on the cards; charging times will become much faster in the future.

Lamba: Agilitee is building a double-cab bakkie that is partly self-charging. We acquired a company in Zimbabwe and have sold more than 30 EVs there. These cars charge from wall-boxes at home, which are solar powered. I believe that there is already progress in charging.

Questions

Will Agilitee be involved in helping franchisees to run their businesses?

Lamba: Yes, there will be a team to hold your hand until we feel you are on your feet; it is your business, but we do provide support. The kind of profit you make will depend on the area you are in.

What is the weight limit of the Laudex, and all the other vehicles you offer?

Lamba: Agilitee bikes have got an amazing ecosystem; all bikes can be tracked with phones, and how much they are carrying, so if a delivery guy picks up his girlfriend, you will know. There’s facial recognition technology that comes with each bike; you can add an extra person, but nobody can steal these bikes: they are intelligent. We are pioneers not just in Africa, but in the world. All our EVs are heavy, and this is because of the battery.

Regarding the share structure, when can shareholders expect to start getting dividends on their shares?

Du Plessis: We need to first establish ourselves in the country before we can focus on profits.

Lamba: We are closing our crowdfunding exercise on 2 July, for good. We declined a large amount of backing from corporates to allow the people of Africa to become shareholders in Agilitee. It took us a long time to raise the money, but when the company takes off, it will change a lot of lives. There is no institutional player involved, only the crowd. For those who wish to buy last-minute shares, you can phone the Agilitee office on 011-3670636.

How many shares will you expose when you list on the JSE?

Lamba: It would be unwise to say how many yet. Agilitee South Africa has been acquired by Visual Inernational Holding LTD in a share-swap deal, which has 401 million shares right now.

What is the cost of maintenance to the bikes, and who is the partner involved in this?

Lamba: We cannot expose this yet, but it is the largest service company in the world. A three-year programme is part of the package when you buy the bike.

What does the marketing drive involve at the moment?

We have a budget of over R10-million for the next few months, for the brand and for the vehicles. We will do marketing for dealerships, so franchisees don’t have to worry about that. We will promote every franchise to the best of our ability. The Cape Town dealership opens soon.

Closing remarks

Middleton: TopGear South Africa is committed to educating the public about EVs. We have a big feature planned for World EV Day on 9 September. I have driven many EVs and they are amazing. There’s another six EVs that will be launched before the end of the year, by top brands, which are pushing this market. The new EVs have a long range on a charge, and I encourage the public to buy them; I am a big fan!

Lamba: Many jobs have been lost, and many will not be regained. The government must support industries that create new jobs. The EV industry will create jobs; I am calling on the government to support it.