Mumbai:Faridabad-based electric vehicle manufacturer, part of Anglian Omega Group, Omega Seiki Mobility (OSM) has signed a joint venture pact with Egyptian e-commerce last-mile delivery company Rabbit Express to tap into the African market.
As part of the JV, in which OSM will hold up to 26% of the capital and Rabbit Express the rest of the capital, the latter will initially export its two and three wheels to the African market and later the two partners will create a manufacturing plant. in capital city of Cairo, said the founder and president of the OSM, Uday Narang.
In addition, OSM will also provide technological support to its Egyptian partner, he said.
The joint venture will see an investment of $10 million to start, and once the manufacturing facility is established it is expected to grow to $50 million, said Hani Mohammed Moshref, CEO of Rabbit Express.
Rabbit Express, 40% owned by Ibnsina Pharmacy, has a fleet of 5,000 vehicles serving several e-commerce customers in Egypt. A company with a market capitalization of $2 billion, Ibnsina serves more than 35,000 customers with more than 375,000 orders per month through its warehouses, distribution and logistics fleets.
It is a full-service company with warehouses, cold chains and packaging. logistics, financing and last mile.
“As part of the alliance with Rabbit, we will initially send our electric vehicles to them from India. And then in the second phase, we will set up with them a first-of-its-kind electric vehicle factory, using our EV technology for different products,” Narang said.
He said OSM is working in different areas with Rabbit, which is a big player in the last mile space in Africa’s second largest automotive market.
OSM has done a lot of work in the domestic EV space over the past few years including backward integration with powertrains, motors and batteries and working with such a big player in Egypt is a step forward for the company, he said.
The company envisions a volume of at least 20,000 vehicles per year through the combination, Moshref said.
“We can, at least, reach 20% of this market (100,000 units per year) or maybe more, in the next 2-3 years. But we have to start first and show the people there and the educate about the concept of electricity.According to our calculations and study, the running cost of these electric vehicles will be very low, maybe 10-20%.And that means a lot in terms of profitability (of the operator ) “, did he declare.
He also said that the financing arm of the group will also achieve good volumes.
However, according to OSM chief executive Debrata Mukherji, the joint venture is expected to have first-mover advantage and has the ability to capture at least 30% market share.
“Rabbit Express is going to be the first (in the segment) to take the lead in electric three-wheelers, so they have a very good chance of reaching at least 30% market share and hopefully in three years. C It’s because before others come, we will be the market leader,” Mukherji said.
The joint venture will not only produce electric vehicles for the Egyptian market, but also for other countries in the region such as Morocco, among others, Moshref said, adding that Rabbit is looking to internationalize and will take advantage of the opportunity to expand to other markets through the JV.
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