Nigeria seeks partnerships to support its EV sector

November 05, 2024

From the newsletter

SIX-EV Limited, an e-mobility company and Nigeria's River State government yesterday signed an MoU to introduce electric three-wheelers and electric buses. At the same time, Nigeria’s National Automotive Design and Development Council (NADDC) visited eMove company,  a leading manufacturer of 2 and 3-wheeler EVs based in Morocco to explore potential partnerships.

  • Nigeria's federal and state governments are all looking into partnerships as they try to catch up with other countries in the EV sector. 

  • Being Africa's most populous country is an opportunity in itself that Nigeria aims to leverage to attract partnerships.

More details

  • In 2021, Stallions Motors and the Nigerian government partnered to locally assemble the electric car, Hyundai Kona. 

  • In July 2024, a Nigerian electric mobility firm, Electric Motor Vehicle Company (EMVC), announced it had attracted $275 million worth of foreign direct investment to Nigeria. 

  • In September 2024, Nigeria and the Chinese Mutual Commitment Company Limited signed an MoU to develop electric tricycles and provide renewable energy training

  • In October 2024, MAX, a leading mobility and electric vehicle platform in Africa, partnered with PASH Global, a renewable energy and impact investment firm, to invest $10 million in expanding Nigeria's EV infrastructure.

  • Across Africa, we are witnessing partnerships between governments, companies, EV manufacturers, energy providers, and financial companies. 

  • For example, the Egyptian company Balkan last month signed a partnership with the Chinese EV maker Zeekr to establish an EV manufacturing plant. 

  • South Africa also signed a partnership with BYD to deliver electric buses for public transport. 

  • While many of these partnerships are promising, some may not come to fruition, especially government-to-government collaborations, due to the complexities of African politics. 

Our take

  • If you can't beat them, join them. This, along with the idea that two hands are better than one, seems to be the common approach for developing markets. Nigeria can't compete with established players in the EV space. Building from scratch is expensive, and many companies lack the financial muscle. Raising capital in such a large market is not as easy as one might expect.

  • With over 12 million vehicles, Nigeria has one of the largest vehicle markets in Africa, representing roughly 75% of vehicles in West Africa. However, its EV market growth remains underdeveloped in comparison.

  • This is an opportunity for EV manufacturers willing to establish a presence in the country.  However, attracting manufacturers will require more than just a large market. Supportive policies are crucial to make the market attractive. Nigeria is addressing this with plans in the VAT Modification Order 2024 to exempt EVs from taxes. This will help attract substantial funding to support the sector's growth.