Electric vehicle taxi company Nopea ride has announced plans to exit the Kenyan market.
The company in a statement issued on Tuesday said that it had begun the process of closing down its operations in the country after one of its majority shareholders declared insolvency.
The company also attributed its decision to shut down its operations in the country to the Covid-19 pandemic which it said had affected its business.
“Following the announcement that our majority shareholder, EkoRent Oy, has declared insolvency in Finland, we are sad to announce that InfraCo Africa Limited the minority shareholder has now filed for the liquidation of EkoRent Africa Limited in the High Court of Kenya,” the statement said.
“This is due to the fact that EkoRent Oy was the principal financier of EkoRent Africa Limited and all the technical knowledge on the running of the business lay with EkoRent Oy. A mention date has been set for 13th December 2022,” it added.
NopeaRide service was first launched in Kenya in August of 2018 under the name NopiaRide by a Finnish company EkoRent Oy founded in 2014.
At the time, the company had only started with about three electric vehicles and two chargers.
However, towards the end of 2019, Nopea received new funding and placed orders for additional electric vehicles and chargers, a plan it said was interrupted by the Covid-19 pandemic.
“Many of the additional vehicles arrived in Nairobi at just about the same time when the strict Covid-19 curfew rules were put in place in March 2020.
“Those rules lead to daily kilometers driven by Nopea vehicles dropping approximately 60 percent overnight. The timing of these additional Nopea vehicles arriving in Kenya could not have been much worse,” the company said.
The company also linked its departure from the country to the failure to raise additional funding to support and expand its operations.
“When closing the initial equity round for NopeaRide, we had estimated the number of vehicles needed to break even in Kenya. We were still short of that number by around 20 vehicles and signed an agreement with a financing consultant in February 2022 to help us find the needed financing,” the statement said.
“Funds would be spent to break even by adding more vehicles in our Nopea fleet, piloting eBoda 2-wheelers that would not remain in our balance sheet and consume our resources as much as 4-wheelers, and to expand our services outside of Nairobi,”
The company which had in 2022 announced plans to partner with a local university to build solar charging ports said that it had already pulled out its vehicles from the road.
“We have taken our fleet of electric vehicles off the road and have notified our staff and corporate clients. We are now working with relevant authorities to ensure that our operations are wound up in accordance with local legislation,” the statement said.
“We would like to extend our deepest regret to our dedicated team of staff and drivers. We would also like to thank our loyal NopeaRide customers, corporate clients, and other partners who have supported NopeaRide’s vision for electric mobility in Africa,” it added.