South Africa's Progress Towards Electric Vehicles: Challenges, Opportunities, and Potential Growth

 Well, let's start off the show with the topic we're buckled up for and that's the road to greater development of the South African electric vehicle market. The products are there but is the local infrastructure ready? That is what probably needs to catch up according to a man dubbed as the bus king of Africa in the headlines. He joins me in studio for more. Welcome Pat Noudada Group Executive Officer at Busmark Africa. So I mean Pat, looking at what we've just been discussing when we're talking the buses that you manufacture, your buses are running the powertrain system. We're exactly are we in terms of the development towards electrifying these buses? I understand that you've developed them already. What's missing? Okay, the buses that we've developed for powertrain is called an integrated bus. An integrated bus basically is currently designed to be able to take diesel engine or powertrain and then it is also designed to take an electric powertrain and hydrogen fuel oil powertrain. The reason why we have not necessarily launched the electric bus in the powertrain is because there's no charging infrastructure to charge those buses but the bus as it runs currently in the system has got a flexibility to be able to run into that. So it's built on that base. We've done this for some few years. We've been waiting for for the government and other players to invest in the infrastructure of charging to an extent that we're now moving on our own to do that. So what has been the government's response to this in terms of developing the infrastructure for these buses to be run on? Okay, so the government has to adopt policy to do the infrastructure change and are introducing vehicles. They need to develop policies that will be able to engage with the electric bus environment. Those policies are not yet there. They steal their traffic phases. When they come into life then we could be able to launch accordingly and people can be able to invest properly into the infrastructure of charging buses and infrastructure of charging vehicles into the country. How many vehicles are we talking about that are ready and just missing infrastructure? Okay, so for the powertrain we have 125 buses that are currently running in the powertrain system currently and now these are buses that are locally made out of our factory and we've got another buses that are running in Pula Guiner's about 36 buses running in Pula Guiner and we've got some buses that are parked in Blum Fontein that have not been used currently and they've got this infrastructure ready. We've built buses for Cape Town with another partner and they're standing and we keep on just testing running them around just to keep them alive. Now it's quite it's quite astonishing to hear the number of buses that you have and particularly the fact that the only thing missing when it comes to these buses actually being on the road is the infrastructure. Has there been appetite potentially from private investment or international investment for this? Okay, so there has been an interest you know so what I've done now we've gone globally Europe, Middle East to find partners who interested in investing in the charging infrastructure. I would definitely say to you as we sit here I've got partners into developing a microgrid for both electric charging and hydrogen fuel site. We are ready to launch the reason why we're doing it to microgrid is because we don't want to be competing with the electricity that is coming from Elskar which is not a zero emission electricity. So we've partnered to create an environment of a zero emission charging infrastructure. So how much capital is required for this? It's very capital intensive to invest into the charging infrastructure because you literally have to invest into a microgrid that you cannot only use on buses. You can also use it on buildings which is the stationery application and also you can use it to power up some tools you know. So we literally would be taking business away from Escom with the introduction of a microgrid. So we're talking to various SESET where we can be able to establish a microgrid in an SESET. We're also talking to government institutions like the powertrain where they can be able to be off grid basically simple based on their tables the maintenance facilities and all of that. Ultimately we've got a situation where we've got buses that are ready. There's partnerships that are being put in place but this is potentially posing a risk or competition risk to Escom. How does this fit into the president's energy plan? Okay we're excited with the announcement of the president's plan because we've got microgrids that are up to 100 megawatt we can expand it to that. The opening up of a microgrid or opportunities is good for us because we can literally not only supply the buses we can also supply the household within the environment that we can be able to operate. Now it moves me away from only manufacturing buses to also to being into the space where I'm now an energy player by default of having to charge the buses and charging that you know. So it's a welcome opportunity and we've presented to the entities to say that you know what we can actually do in the market and we are ready and we're taking things forward. And huge potential there but what about the rest of the continent what are your plans there? So I'm African by Beth you know so priorities for me to to for South Africa but I'm looking at markets like West Africa so I'm working with DRC I'm working with Lagos I'm also looking at South Africa and South Africa I've got a contract for new buses where they all need to be electric and also they've got a similar problem that they have here in South Africa so I'm looking to those markets. I'm literally following the mega cities of Africa which is Lagos, Da, Kinshasa and Joeberg you know I don't look at Joeberg as being Johannesburg I look at it as they are Harkton Province literally. And so how many vehicles are on the road in the rest of the continent? Okay so in the continent I have order for approximately about 500 buses because I need the bigger volume start to come in so I'm starting it in South Africa and Kenya and in Kenya there's a big opportunity to be able to do that because they're not like us you know they are situated in a in a better environment to generate electricity cheaper and they currently using renewables so it might be easier to launch there than to launch in South Africa. That's interesting so it could be easier why? Okay so the energy sources in they've already have a mixed greet in Kenya so most of their energy is coming out from renewables you know coming out from coal whereas South Africa 90% of energy is coming out of coal meaning that 90% you can't be able to achieve zero emissions whereas in Kenya you can be able to deliver a bus now and be able to use the same infrastructure there and you can be able to quickly move and launch there. So talk to me about competition who else is in the market? Look I don't look at their competition you know being selfish in doing that I look at what I'm doing or what my businesses are doing and focusing on that because it will distract my view you know because I want to go forward so I would be distracted to be looking on the sides whose competition and we're getting there. We know that there are people that are trying to look at and get in with their takeses I already have a taxi electric taxi that is running I'm not wanting to develop something new it's something that is already existing is how do I take it to market going forward. So how did you get into bus making? It's not a it's not a common profession I think you're the first one that I meet. I grew up in an industrial town called Butterworth in the eastern Cape and not necessarily from there I'm from Zolo but you know I grew up in Butterworth in growing up in in Butterworth industries were there buses were manufactured there as a child I had a dream to be an engineer and my early life but I couldn't fulfill that you know I ended up being an accountant but I didn't mean that my interest and passion had changed literally so when I left the audition environment after I qualified and all of that my first investments has been in manufacturing and getting into the manufacturing business it was around 2008 where I invested into into into into into into into Basmac and then in investing into into Basmac it it had been a natural interest to grow from owning a a manority stake to owning the entire business. That's that's quite inspirational actually and you you mentioned the EV taxi that you have running currently where is it? Okay so even the EV taxi we can't put it on the road because it can only charge at our own station again it's the same thing so currently we in partnership with the taxi industry and taxi industry are ticked them as partners and now we are working on the infrastructure with various provincial governments to be able to introduce this electric taxi and we are looking for an investment into the charging infrastructure at the at the taxi ranks where we can be able to say it's safe and secure and then you can be able to charge that and also for Tixies it is an opportunity that they can charge at home currently we don't want them to charge at home simple because they don't park at taxi drivers most of them live in in in in poor environment so the competition of charging there is with SCOM and we don't want to really play into that space we want them where they can centrally charge during off peak you know and that central charging must make sense in terms of making sure it's also the road emissions and is there a cost benefit for taxi drivers because I mean they're running on low margins so yeah is it is it cost-efficient okay look they're currently because it's a new introduction of a new technology it's usually becomes expensive when it's being introduced any technology map that you can look at it's expensive when it being introduced but there's more adoption to it then it actually would reduce so we're targeting to say that if we could have 50,000 Tixies on on the roads you know the charging it's going to come they will lesser the generation of electricity will come lesser our focus to get a hydrogen generated electricity is to also reduce cost and it's also to reduce the carbon footprint

Pat Nodada, Group Executive Officer, Busmark Africa spoke to CNBC Africa about the the road to greater development of the South African electric vehicle market.

The road to a vibrant electric vehicle market in SA

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The road to a vibrant electric vehicle market in SA

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