Mobius Motors, a prominent Kenyan automobile assembly company, has announced its entry into liquidation following severe financial difficulties. The company’s Director, Nicolas Guibert, issued a creditors’ voluntary insolvency notice on Monday, a decision made after a stakeholder meeting earlier in the day. This move signifies the end of the company’s operations and the process of distributing its remaining assets to claimants. Liquidation is a critical measure taken when a company is unable to meet its debt obligations.
Guibert’s announcement included the appointment of KVSK Sastry to oversee the liquidation process. In his notice, Guibert stated, “At a meeting of the shareholders held on August 5, 2024, it was resolved to place the company under liquidation as per Section 393(1)(b) of the Insolvency Act and to appoint KVSK Sastry as the liquidator to wind up the company.” The notice also mentioned that a list of creditors and proxy forms would be available for inspection on Friday, August 9, at Mobius’s head office in the Sameer Business Park, Nairobi.
During the liquidation process, Mobius Motors’ assets will be liquidated to pay off creditors and shareholders according to the priority of their claims. Founded in 2010 by British businessman Joel Jackson, Mobius Motors began production of its first car, the Mobius I, in 2011. The vehicle, however, received a mixed reception due to its minimalist design.
Mobius Motors subsequently introduced the Mobius II and Mobius III models. These rugged SUVs, priced at Ksh. 1.5 million and Ksh. 3.9 million respectively as of 2022, aimed to offer a more refined yet durable option in the market. The company enjoyed backing from investors such as Playfair Capital, which provided $50 million in 2019, as well as Chandaria Industries, the U.S. International Development Finance Corporation, and PanAfrican Investment.
Despite the company’s efforts, the Kenyan automotive market, heavily influenced by used car imports from Japan, has been challenging. The Kenyan government has been working to boost local vehicle assembly by attracting investments from global automakers like Volkswagen. Nonetheless, the overall market for new vehicles in Kenya experienced a 15 percent decline last year. Data from the Kenya Motor Industry Association revealed that sales dropped from 13,352 units in 2022 to 11,370 units in 2023. Dealers have attributed this decline to high inflation and a depreciating shilling, which have increased product and production costs.
The liquidation of Mobius Motors highlights the broader challenges faced by local automotive manufacturers in Kenya, underscoring the need for sustained investment and strategic adjustments in a competitive and fluctuating market environment.
