Kiira Motors wants to localise procurement

November 11, 2024

From the newsletter

Uganda's state-owned e-bus manufacturer, Kiira Motors, aims to locally source 65% of its vehicle components by 2030, according to an interview with Richard Madanda, Director of Product Development, published in Monitor (a Ugandan newspaper). Last month, the company assembled a royal wedding carriage using locally sourced materials.

  • The company started in 2007 as a research project creating the first African-designed e-bus. 

  • Since then the company has produced over 27 e-buses and sold them to clients including the Civil Aviation Authority, National Enterprise Corporation and Uganda Airlines.

More details

  • Kiira Motors commissioned a plant in Jinja last month with a current production capacity of 2,500 vehicles. The company plans to upscale the plant in the medium term to achieve an annual production of 5,000 vehicles. 

  • This company has raised a total of $90 million between 2018 and 2023. In March of this year, it submitted a proposed investment budget of $141 million to Parliament for consideration.

  • While Kiira Motors is known for its full-size e-buses, the company also produces various car models and mobility vessels like the three-in-one trike. 

  • To date, Kiira Motors has produced three concept vehicles: the Kiira EV, the Kayoola Solar Bus, and 39 Kayoola buses.

  • The Kayoola EVs have a range of 200 to 300 kilometres on a full charge, making them well-suited for urban mass transportation.

  • Uganda's bus manufacturing industry is very small with only two players: Kiira Motors, which assembles full-size e-buses, and FreedomEV, which imports fully-built electric minibuses. 

  • Both companies develop and deploy charging infrastructure for electric buses in exclusive charging environments. 

  • To support local industry and streamline production, Kiira Motors sources steel, paints, fabrication consumables, silicones, bolts, and nuts from local suppliers, including Doshi and Plascom. 

  • The company manufactures frames and bodies domestically but currently imports chassis systems and electrical systems.

  • However, they have partnered with China for a 15-year technology transfer agreement, aiming to localise approximately 65% of vehicle components and speed up the production process.  

  • According to Madanda, designing a new vehicle takes 6-12 months, while production takes approximately 14 days. Sourcing materials from abroad can take three months in an optimised process, but supply chain issues can cause delays.

  • Kiira Motors is collaborating with private and government entities to identify and set up model charging stations.  

  • The company is also looking to expand its market reach, targeting East African countries like Tanzania, which is implementing a Bus Rapid Transit system.

Our take

  • Uganda's bus market is very small, with approximately 82 operators and over 700 buses in Kampala.  If Kiira Motors targets only the local market, economies of scale won't work. It needs to target more export markets.

  • The East African market is the obvious first choice. However, competition exists in these markets. In Kenya, for example, BasiGo and Roam are manufacturing electric buses locally.

  • As a state-owned company, Kiira Motors has a better chance of securing financing. However, this also has a downside, especially with changing government regimes that might change priorities.