May 19, 2020

Is there a demand for electric cars in Africa?

South Africa
BMW
cars
cleantech
Polycarp Kazaresam
6 min
Is there a demand for electric cars in Africa?

In March, Elon Musk made an exciting Twitter announcement. In just 140 characters, the Tesla owner revealed some big news: Tesla’s latest electric car will be available to buy for the first time in South Africa. Musk’s tweet sparked debates among online commentators; was this a major environmental breakthrough or complete waste of time? With Africa’s infamous power shortages and developing infrastructure, is there even a demand for electric cars?

Current climate

It’s important to know that electric cars are currently being sold in Africa. South Africa has the Nissan LEAF and BMW i3. However, statistics show that electric cars sales in South Africa are meagre. Only 160 electric cars were sold in 2015, compared to the 291,332 bought in the US, and 24,500 in the UK.

In wider Africa, electric cars are even rarer. Home-grown electric vehicle companies like Uganda’s Kiira Motors are few, but they strongly believe that the electric car demand in Africa will grow.

Kiira Motors was born in 2006, when University of Makerere students entered an MIT design collaborative project to build a plug-in electric hybrid car. Allan Muhumuza, VP Sales & Marketing at Kiira, tells us: “Over time the initiative has evolved from an extracurricular activity by scholars at Makerere University Engineering School to a mainstream Government Funded Science and Technology Innovation Program in 2010”.

The resulting five-seater sedan is powered by a rechargeable battery and has an internal combustion engine-based generator for charging. Kiira expects the first commercial vehicle from this line to roll out in 2018.

Kiira Motors joins Kantanka Car, a Ghanaian automobile manufacturing company, as one of the few electric car producers outside of South Africa. Kantaka’s range of cars includes electric saloons, electric four-wheel drive vehicles and electric pickup trucks. These vehicles have been on the market since late 2015.

Support

Although electric cars are relatively rare across the continent, there is support for increased vehicle production. “Advanced research in optimisation of electric powertrain technology is still on-going at various international locations,” Muhumuza explains. “With the invention of cheaper and optimised systems accompanied by the development of relevant infrastructure, electric cars shall avail clean, silent and eco-friendly transport solutions in Africa.”

What will these developed systems and infrastructure look like? Thando Pato, a spokeswoman for BMW South Africa comments on how the firm is enabling such change. “We have always emphasised that in order for electric vehicles and plug-in hybrid electric vehicles to be successful in South Africa, we need to make public charging easily accessible for customers who purchase these cars,” she says.

BMW South Africa offers its own charging options, such as the Wall Box Pure and Wall Box Pro for the BMW i3. These are home charging units that can charge the i3 up to 80 percent charge in two hours. BMW electric car drivers can also use DC Fast Chargers (only available at five BMW i dealerships) and the brand new solar carport. “BMW South Africa are the first market within the global BMW Group network to implement this solar carport,” Pato adds.

Nissan South Africa also provides support for electric car growth in the region; it signed a memorandum of understanding with BMW to jointly roll out public charging infrastructure last year.

Challenges

Support from multinational corporations means little if African’s can’t affors to buy electric cars. In South Africa, the new Tesla will be sold for a steep 530,000 rand at current exchange rates. Uganda is one of the world’s poorest countries (ranked 163 out of 188 countries in the 2015 Human Development Index) so how will citizens afford Kiira Motor vehicles?

“The KMC value proposition is premised against the two core gaps in the industry today: affordable asset financing for vehicle financing and after-sales service and support. Our interventions will focus on closing these gaps as the key strategy for market share acquisition. Affordable asset financing is a key ingredient in making our cars affordable for a Ugandan,” Muhumuza responds.

Charging resources in the rest of the region remain uncommon. “The vital support infrastructure for these vehicles such as charging infrastructure has not been developed,” Muhumuza explains.

Open Charge Map, an online database of global charging equipment locations, backs Muhumuza’s statement. Across the entire continent, South Africa is the only country in which contributors have identified electric vehicle charging stations.

Despite this shortcoming, Muhumuza is optimistic. “The demand for clean silent transport technologies such as electric vehicles shall increase with the development of such vital infrastructure in the region,” he insists.

Africa’s infamous power shortages also challenge the demand for electric cars. According to the New York Times, all of sub-Saharan Africa’s power generating capacity is less than South Korea’s, and “a quarter of it is unproductive at any given moment because of the continent’s aging infrastructure”.

In South Africa, there is a long history of “load shedding”. When there is not enough electricity available to meet the demand from consumers, Eskom (the country’s largest producer) will interrupt supply to certain areas. Critics of Musk’s announcement cite this issue, but BMW South Africa claim that they adapt to the disruptions.

“Loading shedding happens in periods throughout the day and an electric car can be charged during off-peak times, like when it is parked and overnight,” Pato says. “With our ConnectedDrive App, a customer can constantly monitor the status of the car, even when they are not in it. So if the car is connected to a charger and there is load shedding and it stops charging, the ConnectedDrive App will be able to read this”

Muhumuza also believes that Africa’s electricity issue will be overcome. He tells us how Uganda’s power generation has risen from 830 megawatts to 596 megawatts in 2010.  He also points to the rise in renewable energy investment as a factor phasing out power shortages in Uganda.   

“Major big hydro power projects such as Karuma and Isimba are bound to double the hydro power supply coming to the grid. This presents power sufficient to run the Kiira Motors Complex as well as run the economy.”

Future

Not only is renewable energy becoming more popular in Africa, cleantech (technology with commercial and environmental benefits) is showing promise as well. An EY report on foreign direct investment (FDI) found that cleantech is in Africa’s “next wave” of emerging sectors. If investors like Musk begin to fund electric car manufacturing across the continent, and access to electricity continues to improve, we may see more electric cars on African roads.

Notably, there is a clear gap in electric car presence between South Africa and the wider continent. Besides the fact that it is his birth nation, there is an economic reason why Musk decided to launch the new Tesla solely in South Africa.

However, electric car fever may gradually creep across Africa. According to Pato, BMW sees potential in wider Africa. “We have just started with operations into sub-Saharan Africa and in the long term electric cars will be part of the plan in future,” she says.

Likewise, Kiira Motors state export within Africa as a core goal. Kiira, BMW South Africa and other electric car proponents recognise the vast challenges ahead of them. However, their counter-strategies and enthusiasm suggest that perhaps in the distant future, Africa will be ready for electric cars. For now, both naysayers and advocates will have to use the Tesla South Africa’s performance as a litmus test. Will Musk galvanise Africa’s electric car revolution?
 

African Business Review’s September issue is now live.

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Jun 18, 2021

GfK and VMware: Innovating together on hybrid cloud

GfK
VMware
3 min
VMware has been walking GfK along its path through digital transformation to the cloud for over a decade.

GfK has been the global leader in data and analytics for more than 85 years, supplying its clients with optimised decision inputs.  

In its capacity as a strategic and technical partner, VMware has been walking GfK along its digital transformation path for over a decade. 

“We are a demanding and singularly dynamic customer, which is why a close partnership with VMware is integral to the success of everyone involved,” said Joerg Hesselink, Global Head of Infrastructure, GfK IT Services.

Four years ago, the Nuremberg-based researcher expanded its on-premises infrastructure by introducing VMware vRealize Automation. In doing so, it laid a solid foundation, resulting in a self-service hybrid-cloud environment.

By expanding on the basis of VMware Cloud on AWS and VMware Cloud Foundation with vRealize Cloud Management, GfK has given itself a secure infrastructure and reliable operations by efficiently operating processes, policies, people and tools in both private and public cloud environments.

One important step for GfK involved migrating from multiple cloud providers to just a single one. The team chose VMware.

“VMware is the market leader for on-premises virtualisation and hybrid-cloud solutions, so it was only logical to tackle the next project for the future together,” says Hesselink.

Migration to the VMware-based environment was integrated into existing hardware simply and smoothly in April 2020. Going forward, GfK’s new hybrid cloud model will establish a harmonised core system complete with VMware Cloud on AWS, VMware Cloud Foundation with vRealize Cloud Management and a volume rising from an initial 500 VMs to a total of 4,000 VMs. 

“We are modernising, protecting and scaling our applications with the world’s leading hybrid cloud solution: VMware Cloud on AWS, following VMware on Google Cloud Platform,” adds Hesselink.

The hybrid cloud-based infrastructure also empowers GfK to respond to new and future projects with astonishing agility: Resources can now be shifted quickly and easily from the private to the public cloud – without modifying the nature of interaction with the environment. 

The gfknewron project is a good example – the company’s latest AI-powered product is based exclusively on public cloud technology. The consistency guaranteed by VMware Cloud on AWS eases the burden on both regular staff and the IT team. Better still, since the teams are already familiar with the VMware environment, the learning curve for upskilling is short.

One very important factor for the GfK was that VMware Cloud on AWS constituted an investment in future-proof technology that will stay relevant.

“The new cloud-based infrastructure comprising VMware Cloud on AWS and VMware Cloud Foundation forges a successful link between on-premises and cloud-based solutions,” says Hesselink. “That in turn enables GfK to efficiently develop its own modern applications and solutions.

“In market research, everything is data-driven. So, we need the best technological basis to efficiently process large volumes of data and consistently distill them into logical insights that genuinely benefit the client. 

“We transform data and information into actionable knowledge that serves as a sustainable driver of business growth. VMware Cloud on AWS is an investment in a platform that helps us be well prepared for whatever the future may hold.”

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