- The global move towards electric vehicles (EVs) for emission reduction and economic advantages is growing. Mr. Sam Faleye, CEO of SAGLEV, a U.S. EV company, talks with TheTimes about the potential for EVs in Nigeria post-fuel subsidy removal, emphasizing job creation and environmental benefits.
- He underscores that power availability isn’t a major issue for EVs, thanks to their ample range. SAGLEV’s success in Ghana validates EV feasibility in West Africa, with regional expansion ahead.
- Faleye highlights the affordability of EVs, citing lower maintenance and fuel costs. Collaborations with banks aim to enhance accessibility.
- Faleye emphasizes job creation potential in the EV sector: charging, training, finance, and more.
All over the world, the shift to electronic vehicles is gaining traction as efforts to reduce emissions hit the top gear.
Beyond the climate change actions, stakeholders are also pointing out the numerous economic benefits of embracing EVs.
While the campaign is already getting to Nigeria with a few affluent Nigerians buying Tesla EVs, there are still concerns that the revolution may not gain ground in Nigeria because of the country’s perennial power challenge.
In this interview with TheTimes, Mr. Sam Faleye, the Chairman and Chief Executive Officer of SAGLEV Inc., a Delaware, U.S.A. Incorporated Electric Vehicle Company, delves into the economics of EVs in Nigeria and argues that it is now the most economical option for Nigerians with the removal of fuel subsidy.
Faleye, who is one of the three co-founders of SAGLEV, also speaks on the company’s plans to start assembling electric vehicles in Nigeria this year and the prospects of new jobs for Nigerians. Excerpts:
TheTimes: Can you give us an overview of SAGLEV Incorporated and your objectives in coming up with the idea of electronic vehicles in Nigeria?
Sam Faleye: SAGLEV focused on the adoption of zero-emission vehicles, primarily in emerging markets. And Sub–Saharan Africa, because the need is great.
The GDP in the emerging market is so slow to the point where any kind of help through which you can decrease the cost of living for everybody will be a huge benefit.
We saw the opportunity to do this in such a way that we are able to pretty much achieve the proverbial killing of multiple birds with one stone.
This is because with EVs, you’re able to reduce the overall carbon footprint, you’re able to improve the climate, and you’re literally able to provide employment opportunities. You’re able to at the same token, improve people’s earning power, all of this in one.
So, for many years now, we have been really looking at this situation and found out that all of these things are actually possible.
Now, let me tell you a little bit about SAGLEV at this point. SAGLEV is a US company. We are three co-founders, myself. There is another co–founder, Femi Adeyemo, who is the CEO of one of the biggest solar companies in West Africa in Nigeria.
The other co-founder is an engineer, Gbolabo Odunaiya, who has been manufacturing Teslas and other electric vehicles in the United States. So, we are Nigerian Americans for all intents and purposes.
So, that lets you understand that it’s in our DNA to manufacture electric vehicles and renewable energy is in our DNA directly.
So as far as what brought us into Africa, let me give you another background: The three of us are direct climate evangelists, we believe directly in climate change, and we believe in renewable energy not only as a solution but as a way to clearly advance entrepreneurship directly.
Personally, I’ve always wondered why electric vehicles have not been used extensively in Nigeria for over five years. Well, the obvious question is that petrol was too cheap in Nigeria. Let me give you some data to put this in perspective.
A year ago, petrol was about N180 per litre. So while petrol was 187 Naira to a litre, in Ghana, it was equivalent to about N850 Naira to a litre.
At the same time in Abidjan, Cote d’Ivoire, about the same price, but in Nigeria, it was N187 because there was a fuel subsidy.
A lot of people can trace Nigeria’s economic woes directly to the subsidy because this money was not well managed. Let’s not even go into that whole discussion.
But it was really depriving us of effectively putting our GDP to develop the country.
So, this was one of the things that were not allowing us to face reality. So as a result I’ve always wondered why, but it turns out that, you know, we felt like electric vehicles were impossible or not doable.
I, for example, have driven electric vehicles in the United States since 2013. I consistently drive electric vehicles I have driven two or three Teslas I have a Porsche Titan, which is my everyday car that I drive apart from the fact that I’m also a car collector. So I’m a lover of cars, especially antiques.
However, I’ve always wondered why is this not happening in Nigeria. So, the direct reason I found out was that petrol was just too cheap.
But as the subsidy was removed, you can see that that this forced people to understand oh, we have to look for alternatives.
The only problem is that we did not have time to plan for this right. The subsidy had to go because it was hurting us in many ways. It’s now about two and a half years ago that we set up shop in Ghana.
We are developing an assembly plant which actually should have opened before the Nigerian plant so we have been collecting data we brought a number of electric vehicles into Ghana.
We already have electric vehicles in Ghana that are delivering Uber passengers and collecting data.
We have a lot of clients who are already on board talking about how they can acquire electric vehicles. So, the question of whether electric vehicles can be used here is not an issue.
TheTimes: In Nigeria, one major concern when you talk about electric vehicles is the issue of power. Are these concerns justified given the need to constantly charge your EVs?
Sam Faleye: I can assure you that that is not a problem. For instance, for the last three months in Nigeria, I have driven electric vehicles. We have three of them here.
And I charge them, I have a charger here at home. So there’s no reason why Nigerians are not using electric vehicles.
This solution has always been there. So the next question is, well, you know, but we have electricity supply problems in Nigeria. That is true.
But I think that the issue of electric power is a little bit overblown. Electric power availability in Nigeria has been a very bothersome problem.
It’s been very traumatic to Nigerians therefore, when you receive so much trauma for one particular problem, it just involves your imagination to the point where you think nothing requiring electricity is impossible.
The truth is that one of our models of EVs would go 300 kilometres on one single charge. It takes four hours to charge that vehicle and you can charge it right at home.
Now, if you take the entire population of Nigeria, how many people in Nigeria have access to four hours of electricity a day? Is it 20% is it 50%? You can start to imagine that this is actually a large percentage of the population.
Now, if you start crunching the data, which we have done, electricity supply and availability have actually increased in Nigeria.
And what is increasing it is that all the other sources not just hydro not just thermal, not just gas, but renewable sources have come into play, particularly solar.
Now if you also crunch down on the data, you will find out that the people who are likely to buy an electric vehicle actually have electricity.
So, people have generators, people have power. If you now add all that and actually find out how many people have four hours of electricity a day, we will be talking about 50% of the Nigerian population.
So, the whole issue of power is what I’m trying to put this in perspective, you are beginning to see that it looks like we have been traumatized a little bit because of this power problem. And anything that has to do with electricity, we just see it as impossible.
In actual fact, when you drill down you find out that this is actually possible. And I’ve been wondering about this for five years, actually. At least, which is what led us to say listen, we have to get this thing done and show that this can be done.
I was born here and I started my education here. I’ve lived in the United States for about 32 or so years. And again, at the end of the day, you can ‘japa’ out but you’re going to ‘japada’. So, we found out that there’s a lot we can contribute.
You can see now that if you have a vehicle like that, for example, you are able to go 300 kilometres with a four-hour charge. Now let us drill that information down a little bit.
This 300 kilometres, how many people that live in Lagos or any similar city drive 300 kilometres a day? So, most people drive maybe worst-case scenario 50 to 60 kilometres.
The truth is that if you’re driving your car within the city, you’re not going to need to charge this car more than once or twice a week.
So, there’s a lot of education of the population that has to happen. So, this is part of why we said we have to do this. So, you now start seeing some of the reasons why we are in Nigeria and why we are in Sub-Saharan Africa.
Our operations are Nigeria, Ghana, soon to be Cote d’Ivoire, and then most likely South Africa at some point so you can now see that once people start understanding they start seeing that this is possible. So, this entire story of electric vehicles is very possible.
TheTimes: You mentioned your operation in Ghana and the fact that EVs are now being used for Uber over there. What is your level of operation in Nigeria right now?
Sam Faleye: We have been in the region and even in Nigeria for about two and a half years just quietly. There is a saying that it is difficult to keep a secret in Nigeria or Africa.
That’s not our experience because we have been around for two and a half years and I doubt if you have ever heard the name SAGLEV.
We have been collecting data, analyzing it, and putting costs to the test. We are about to open up our assembly plant in Nigeria.
The first one was supposed to actually open in Ghana. But because of the emergency situation in Nigeria and the National Automotive Design and Development Council (NADDC) encouraging us by saying, look, you guys have this plan and there’s a problem you need to be part of the solution, we decided to come and fast track things.
We were not planning to be in Nigeria till Q3 or Q4 next year, but we now have a facility that should open and literally start assembling vehicles in December 2023, which is actually three months time.
So this is where we are in Nigeria. We’re already talking to the ridesharing companies.
We’re talking to the rideshare owners, we’re talking to all the drivers we’re talking to people in mass transit, we’re talking to fleet owners, because our priority is to go to initially where the biggest polluters are, which is mass transit.
So, that’s why we said okay, we have to have a business model that really starts with fleets and then goes to the individual car user.
So that is where we are in Nigeria. We have cars and we are already approved as an automotive manufacturer.
We have equipment abroad that is getting ready to be brought in we have been inspected by the NADDC and have been approved as a licenced automotive manufacturer. So this is where we are.
TheTimes: Now that you have said power is not an issue when it comes to the embrace of EVs in Nigeria. The next question that comes to mind is how affordable these electric vehicles taking into cognizance the availability of ‘tokunbo’ or foreign used cars, which people can buy for as low as N3 million or N4 million?
Sam Faleye: So, that is a very interesting question that I really appreciate. These cars are shockingly affordable. When I say shockingly, you have to also put that in perspective.
So, you’re right. The Nigerian ecosystem has survived on the tokunbos, but I think Nigeria as a country has been playing a little bit of Russian roulette on that front.
This is data that we ourselves have actually crunched and done research on, 98% of the tokunbo vehicles are vehicles that are on the salvage title.
And what that means is a vehicle that has been condemned, is not to be able to be repaired by the insurance companies.
People take them, repair them, and bring them in. So, the risk abounds in that aspect. But you see, we have a problem. And the problem is people need cheap cars, right?
So, you know, we have to solve that problem. So, I don’t fault people doing that but the problem is that the inherent risks of depending on used vehicles also depress your manufacturing capacity, because you’re not learning to manufacture.
You are not improving your manufacturing capacity. You are not benefiting from the jobs in manufacturing and the transfer of technologies, just the whole gamut of things that can be traced to the used vehicle trade.
So why would say that, by nature of the electric vehicle, you really just don’t want to use the electric vehicle as such? Because the most expensive part of the vehicle is the battery.
Let’s go back to cost for a minute, if you look at one of our models which is slightly bigger than the Suzuki Espresso, probably about 20% Bigger, this vehicle is roughly N16 million.
This is a brand-new electric vehicle. So, if you compare it to say a brand-new Toyota Corolla, that is about N37 million.
Now, the cost of a car also includes the cost of ownership and cost of maintenance, which is the true cost of the car over the lifetime of the car.
So, you will agree with me that the EV is shockingly cheap. Like I said we have been doing this for two and a half years.
So, under the current cost of petrol, if you’re driving a Suzuki 9000 or maybe a Corolla, a Camry, a Hyundai, and even this GAC, you’re going to spend somewhere around N14,000 plus a day for petrol.
For an EV, your cost of charging for that day is no more than N2,000 and I’m talking about live numbers, and that cost I’m giving you includes the cost of electricity, the cost of the charger, and the location where you charge.
So, we actually have plans in locations where we have banks of chargers that are getting ready to be deployed, where you can go charge your car for hours after the end of the day you start your car the next day with the full charge, you’re not going to finish 300 kilometres as an Uber driver. I know that because we have also been collecting that data. How many miles does an Uber driver drive a day?
I know that because we’ve been collecting that like I told you we’ve been on the ground for over two years. I’ve never seen an Uber driver that ever drove more than 300 kilometres in a day. So you can see where it’s starting to make sense.
Another thing that I want to make clear is that the cost of maintenance of an electric vehicle versus an internal combustion engine vehicle is usually about 50% because the electric vehicle does not have a carburettor, crankshaft engine oil, all the things that get bought normally in a car, the electric vehicle does not have those things.
It is just an electric motor and a battery, the maintenance cost is way less.
The only thing that the electric car does share in common with internal combustion cars include parts such as suspension, tire, headlights, headlamps, shock absorbers, and brake pads.
But again on electric vehicles, the number of times you go to service your car is much less. There is no need to check your oil.
You take the car for a check to make sure the electrical system is fine and the batteries are in good shape. You are gone.
The electric motor has an oil that is changed maybe once in 10 years. You don’t need to take it in for service more than once a year just for a checkup.
TheTimes: The market for EVs is still very new in Nigeria and even as much as people may want to switch to EVs to cut costs, finance is going to be a challenge. Do you have any kind of partnership or a financing program to make Nigerians key into this EV revolution you are driving?
Sam Faleye: Yes, we are partnering, believe it or not, the banks are very interested. Of course, the banks themselves are struggling to pay high costs for their old pool of vehicles.
So, they themselves are starting to ask. Yes, a lot of partnerships with banks, financing organizations, and people who have ideally been focused on financing internal combustion cars are now looking to finance electric vehicles.
We are also having partnerships for training of technicians, people who can assemble the cars.
We have been working on that for the greater part of a year and a half. We position ourselves primarily as an auto electric vehicle automotive manufacturer.
So, the actual direct financing is not what we need to get involved but there are people who are focused on that and who are highly interested.
We are going to be engaging in some initial pilots just to show people but other than that, you know there are people who are heavily invested and heavily interested in financing.
So just like solar, don’t forget that when solar came, it was very expensive, but now you can literally get solar financed easily.
TheTimes: What has been the role of the government in all these in terms of regulation and how is the EV industry regulatory environment currently?
Sam Faleye: Well, interestingly, electric vehicles might be new in their introduction into the country. It’s like a dream that is just coming true, but it’s not for the lack of the dreamer.
The Dreamer has been dreaming about this for years. So, the honest truth is that believe it or not, there is the National Automotive Design and Development Council (NADDC).
They are very active, and they take care of all automotive design development and manufacturing. They are the primary body responsible for recognition and regulation.
Believe it or not, I was surprised to find out that there is actually a curriculum for electric vehicle technician training that has been in existence for years.
So, this is what I tell you is not like Joseph has not had the ability to dream.
And I like to tell the stories because I found out that as Nigerians we need to understand we have policies, we just need to implement them.
TheTimes: Earlier, you made reference to research and data you have been collecting ahead of your commencement of operations in Nigeria. In all these, what are the foreseeable challenges that you see in this business and how do you intend to overcome them?
Sam Faleye: Personally, I like to learn about challenges, but I refuse to acknowledge them, I just want to know about them because I’m always looking for solutions.
So, one of the challenges, of course, is financing. We have to go from that culture of buying used cars to buying new ones. Somewhere along the line, those tokunbos will come but for the electric vehicle, you’re best to stay away.
And the policy direction is actually to not even allow those used vehicles to come in, which is for a good reason. So, that’s one challenge. Of course, you have a lot of mechanics but we do not have electric vehicle certified and trained mechanics.
The challenge I know is there but I just refuse to acknowledge them because there are solutions. By the time we open in December, we are going to have a minimum of 25 fully trained certified electric vehicle technicians and assemblers ready.
Another challenge that I see out there is the lack of information. People just need to know that the option is there. You have to know the option is available for you to go for that option.
People have to learn there are some subtle differences between driving an EV and driving a regular car.
You have to keep in mind that this is a car that has a certain range and a certain need for charge and while you have petrol stations on every corner, you can fill up your EV car in virtually 10 minutes.
But the good thing is that Nigerians are very good at one thing and that thing is adaptation.
If a Nigerian can not adapt to a situation, you can start assuming that nobody can adapt to it. So, I can already see them adapting to EVs. I’m seeing it.
We have Uber drivers who are coming around to test-drive our cars. They’re already asking intelligent questions. They are already saying oh, how I wish I knew this was available, I would not have bought this one.
Again, as far as electromobility is the future is bright. There’s a lot of work to be done. So those are the biggest challenges. The cost is there. There is the issue of a battery. But there’s a lot of improvement in battery technology improvement in even being able to change the cell battery repair work and all those things.
TheTimes: What are the prospects of job creation for Nigerians in this new industry?
Sam Faleye: This is one of my favourite questions. Let’s even talk about e-mobility and not specifically about electric vehicles because the equipment itself is only 30% of that entire ecosystem.
Think about it upstream, downstream. Think about it in the same way with power or petroleum, there’s a whole ecosystem in that whole industry.
So, let us take it from, say electric vehicle charging, you have people in the power provision, power distribution, and electric charging, you have opportunities for people to go into the electric charging business. These are all jobs.
Then there are a lot of people who are going to be training as electric vehicle technicians, and service.
You are going to have a lot of people who are going to be involved in the whole support systems, payment systems, finance systems, loans for EVs payment processing from charging.
Now, let us talk about training. There are some people whose work is just going to be to sit down and start training electric vehicle technicians service.
There is going to be a whole curriculum, which ensures that when people come out of school they need to know some basic things about EVs.
There’s a whole gamut of jobs anytime you mention e-mobility. And I’m very hopeful that this is one of the many industries that will create new jobs just like Nollywood.