Non-Chinese Asian presence in Africa is accelerating

From the newsletter

Filipino motor vehicle manufacturer Francisco Motors Corporation (FMC) has signed a deal to supply electric minibuses and hydrogen-powered tricycles to Nigerian firm Space AI Nigeria. FMC will supply two main electric minibus models: a 15-seater mini-van tailored for corporate transport and a larger 30-seater vehicle intended for local public transit. 

• At home, FMC sells the minibuses at about $17,400, mainly targeting the low-end market. This is less than a third of the $53,100 average price for other electric minibuses.  

• Chinese EV firms such as BYD, Yutong, Dongfeng and Xpeng have flooded the African market in recent years with cut-price EVs. However, manufacturers from other Asian countries such as Japan, South Korea, India, Sri Lanka and the Philippines are also eyeing the rapidly growing market. 

More details

• FMC’s electric minibuses are designed with durability, energy efficiency and price in mind. It is these qualities that have made the vehicles popular in the Philippines, and the company is hoping that this will attract consumers in Africa, a similarly highly price-sensitive market.

• Thousands of tricycles operate in Nigeria, where they are used to carry passengers and goods over short distances. FMC will supply hydrogen-powered tricycles to Nigeria. But as hydrogen is still a new fuel technology that is not available in Nigeria yet, it is unclear how the buyers aim to utilize them. “Francisco Motors’ hydrogen fuel cell-powered e-trikes are good to go. While most developed countries are years away from commercial applications, we are poised to locally mass produce these and roll them out,” said the company’s CEO Elmer Franscisco in April. 

• While the Filipino company has been doing business with African countries for decades, this mainly related to the supply of fuel vehicles. In 2003 for instance, the company, which produces more than 250,000 vehicles annually, inked a deal with Sierra Leone to supply 100 vehicles per month for an unspecified period of time.

• As part of the latest deal to supply the EVs to Nigeria, the program includes the establishment of charging stations, hydrogen refueling infrastructure, digital fare systems, and local assembly training. At the same time, the Filipino company is exploring the possibility of assembling the vehicles in Nigeria.

• FMC’s vehicles are similar in function to Nigeria’s Molue buses that were once common in Lagos before being replaced by the BRT system. Nigeria, which is Africa’s largest economy, has faced consistent mass transportation challenges especially in major cities like Lagos, which suffer from congestion.

• EVs, especially large-capacity buses, can significantly contribute to solving Nigeria's mass transportation challenges. EVs offer a cleaner, more cost-effective, and sustainable alternative to traditional combustion engine vehicles, especially for public transport. Currently, the main supplier of electric buses to Nigeria is Chinese bus manufacturer Yutong. Local startups like NEV Electric are also stepping in to assemble electric buses locally, using mainly imported components.  

• Nigeria and Africa at large lack the capacity to make EVs at a large scale to solve their transportation challenges. The entry of Asian companies into the market is helping drive down prices, boosting affordability. 

Our take

• The arrival of FMC’s low-cost electric minibuses could trigger greater EV uptake, especially by small- and mid-scale transport operators who previously found Chinese options too expensive. This could lead to more diversified public transit fleets in cities like Lagos and Abuja. 

• FMC's entry, along with others from the Philippines and South Asia, will intensify competition with dominant Chinese electric bus firms, especially BYD and Yutong. This could further drive down prices and improve vehicle features, benefiting African buyers and accelerating the transition to electric mobility.

• The Nigerian government will face growing pressure to rapidly develop EV charging and hydrogen refueling infrastructure as new energy vehicles increase in numbers. This should prompt policy incentives, government partnerships, or donor-backed projects focused on green mobility infrastructure.