Q&A: Why Roam is betting against battery swapping for e-bikes

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Roam electric motorcycles utilize a dual-battery system, allowing riders to carry two batteries. Each battery provides a range of up to 90 km, giving a range of 180 km. This highlights Roam’s big bet on high-capacity rechargeable batteries, even as its competitors bet on battery swapping. Mobility Rising spoke with Roam’s Head of Strategy and Innovation Hans Van Toor. 

• Mr Hans was an investor in Roam long before he joined the company on a full-time basis in 2023. Tasked with steering innovation at the startup, he also chairs the electric mobility sub-sector at the Kenya Association of Manufacturers (KAM).  

• Mr Hans says that with rechargeable batteries, Roam’s motorcycles can be driven anywhere. “Obviously that's not possible with swapping stations, because if you don't have a swapping station, how are you going to drive?”

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Can you take us a bit through your journey at Roam?

Mr Hans: Over the past 15 years, I've focused on the nexus of new manufacturing methods and sustainable transportation. The journey started when I sold my company, which focuses on sustainable air transport. We made zeppelins and Kenya was one of our target markets. After this, we looked at electrifying aviation and that time, Roam electrified safari camps. We saw an opportunity to connect electric flying, so together with a group of angels we invested four and a half years ago. Since then, I fell in love with Roam’s mission. I have never seen a company with such a synergetic impact across the triple bottom line, as Roam's business model is built for long term, sustainable profit, but also to make an impact on people and our planet. I joined full time one and a half years ago and now lead strategy, innovation and public affairs. I am deeply passionate about creating good jobs in the region and the EV transition is such an opportunity to do so. Roam pioneers in local manufacturing. Through this I was elected as the chair of the EV sub sector at the Kenya Association of Manufacturers (KAM), working more with the upstream players in the EV component space and the contract assemblers. 

There’s a debate over which model between charging and swapping is ideal for electric motorcycles. Why did Roam choose the charging model?

Mr Hans: There are some great swapping companies out there. The main benefits of swapping are that companies earn a high margin on energy, buying it at a low price and offering it at a higher price. For riders the benefit is that you can start without buying the battery. For riders that may seem like a good option, but it turns out to be quite expensive; up to three times more per kilometer for the end user.

The climate urgency needs a solution that can scale fast. The challenge with swapping is that the need for charging infrastructure limits scale. Swapping can only serve high density areas like capital cities and its capital intensive to scale; charging infrastructure is costly and you need a lot of extra batteries in the system. Chinese suppliers support swapping, as it means they can offset a lot of goods, but in the end the boda riders pay the price. Due to this higher cost, some swapping companies are forced to compromise on quality. This was one of the driving factors for Roam to go for a different model, as we don't see this as a long-term business model. In the ICE age, we saw Honda as a market leader. They are not the most affordable, so we know riders value quality. 

As Roam we want to bring a high-quality product at an affordable price. Roam decided to offer riders a charger which can charge your motorcycle in any normal socket. This is more affordable for the rider and Roam can scale faster. To bring quality at a good price, you need economies of scale and with this model Roam can access the whole market. Every Roam Air is traceable, which helps asset financiers and riders in lowering default rates. Our telemetry platform shows Roam motorcycles in Wajir, Lodwar and some even popped up in West Africa. Our software platform shows where they (bikes) are, how fast they're going, what the battery state of health is. Somehow people took them there and obviously that's not possible with swapping stations, because if you don't have a swapping station, how are you going to drive? How are you going to drive your bike in Turkana?

I think why we haven't seen the explosive growth in EV to date, is that EV sales have been predominantly in capital cities. Now that home charging models are scaling, we're now starting to see bikes also going into areas outside of capital cities. It's a very exciting time to see that Roam is ready to scale, and there's really positive feedback on the product. 

Roam assembles its units locally. What are the pros and cons of that versus importing fully-built units?

Mr Hans: As an engineer, transport in East Africa is an exciting challenge; requiring performance and affordability. The only way to retain quality is through product- and process innovation, cutting out the middle-man and local manufacturing. Roam has achieved 39% local content for the motorcycle and 47% for the buses.

As a company, we want to have a positive impact on people, the planet and profit. We seek solutions that find synergy across all three as this enables long term sustainable businesses.

I think what's exciting is that we've seen that for some parts, China, Europe, India, sometimes are unbeatable. They are at a technological advantage or a scale, economies of scale that will have the best product for end users. But for some components, we actually see that Kenya has quite an advanced automotive ecosystem.

And we recently did a study with Manufacturing Africa, and they showed that if Roam can continue on this path, one job in Roam creates 22 jobs in Kenya, high value jobs, and for a fully built unit, that's actually around one, just below one. It is also a different type of job. Esther joined Roam three years ago as an apprentice from a TVET in Western Kenya. When she told us she was offered a job at Tesla as a powertrain engineer it was sad to see her go, but also really cool. With Esther there have been many like her, joining Volvo, JLR or other EV companies in the region. Kenya is full of talented people and we are proud to be part of peoples journey. Roam has been around for 7 years and we see the first people coming back to Roam after a few years abroad, gaining invaluable experience.

What we see is that there's this positive synergy between, if you own the design IP and you own the tooling, you don't pay margins across the value chain, so your costs of goods actually become lower, and you can maintain quality. If you import, you have to decide between quality and cost, and it's largely out of your control. And for us, it's a lot in our control, and that's really exciting. 

What is Roam’s current production capacity, and is it able to handle the demand for electric motorcycles in the market?

Mr Hans: Everybody's experienced the same problem. There's more demand than there's supply. If you imagine, for importing you can fit about 100 bikes, maybe 120 bikes in a 40-foot container. If you make a frame locally, you can easily fit between 7,000-8,000 components of a frame in that same container. If you start by localization, you actually start to be able to get to economies of scale. Today, we can put 42 units through a single shift on a single assembly line, and we have the ability to go to eight assembly lines on three shifts a day, six days. So, we have a theoretical capacity of 38.000 units per year per assembly line. The bottleneck is capital. As you know, access to capital and cost of capital are barriers to growth in Kenya. As an entrepreneur, leaving demand on the table is frustrating and investors are leaving an opportunity in the table. That's a limitation today.

What are the biggest challenges that cut across the industry that Roam and other EV companies are facing in the market at the moment?  

Mr Hans: The EV space today is such a fast-evolving ecosystem, before a challenge comes up, it's solved and another one pops up. What is really exciting is that through associations like KAM and others, we see that there's a lot of good development across government and private sectors. There is a lot of positive momentum to try and resolve issues. I do think that what is needed is we need economies of scale, and for that, we need harmonized policy.

Kenya, Rwanda, Uganda, Tanzania, Ethiopia, we need to come together, and we need to agree on what is the view on how this moves forward. The Chinese government is pushing hard to import goods into Africa. The recent declaration offers African countries duty free access to the Chinese market. I think that that has the potential to be a bit of a Trojan horse, because if we look at Kenya, for example, Kenya exports $290 million to Africa and imports $6 billion from China. So, there's a huge difference, and what we export as Kenya to China is mostly unprocessed materials, so there's also not a lot of value addition there.

I think as a region, even Pan African, we need to make sure that we think very consciously about if we want jobs here, and recognize that we have an opportunity to create jobs, but this is not a five to 10 years from now discussion. This is a today discussion, and there is an opportunity, but I think the private and public sectors would need to come together to see how can we actually create those jobs here, because importation, unfortunately, does not create jobs as we know.