Kenya's Mobius Motors Shutters Operations Amid Financial Woes

Kenya's Mobius Motors, known for its rugged, affordable SUVs tailored for African roads, is ceasing operations due to financial difficulties. Tax hikes in Kenya made its business model unsustainable. Despite considering moving production, logistical challenges prevented such a move. Creditors will vote on voluntary liquidation on Aug. 15.

Kenya's Mobius Motors, which began manufacturing affordable, rugged SUVs for Africa's challenging road conditions a decade ago, has announced it will cease operations due to financial issues, according to a company statement and a shareholder source on Tuesday.

Founded by a London-born investor who encountered Africa's rough terrains while working in Kenya's forestry sector, Mobius was adversely impacted by tax increases in the East African nation, making its business model untenable, a source from one of the company's shareholders revealed to Reuters.

The shareholders considered relocating production to another country, but this option was discarded due to the complex logistics of transferring the existing assembly line from Nairobi, the source added. Mobius, promoted by investors including Britain's Playfair Capital, faced stiff competition from second-hand imports, a challenge shared by other local manufacturers like Uganda's Kiira Motors and Nigeria's Innoson Motors.

(With inputs from agencies.)