Electric vehicles: Firms are eager to provide 7-year repayment for e-hailing drivers– Sam Faleye of SAGLEV

As fuel prices continue to increase in Nigeria, transporters, including e-hailing operators, are seeking more affordable energy sources. Options include switching to compressed natural gas (CNG) and electric vehicles (EVs). But, one of the major challenges of considering a switch is financing.

While there has been a CNG financing scheme powered by the federal government, there aren’t options for electric vehicle financing. But, that does not mean there aren’t any financing schemes for EVs.

According to Sam Faleye, the CEO of electric vehicles manufacturing company, SAGLEV, some financing companies are eager to provide long-term funding for e-hailing drivers willing to operate with EVs. The CEO disclosed this in a chat with Technext.

According to Sam, the longer life span of electric vehicles and the impressive revenue prospects make them very tempting for financing companies:

“Because of the long life of electric vehicles, banking and financing companies are eager to finance EVs much longer. Not three years or 18 months, whatever. Some are already talking about financing electric vehicles for up to seven years. The issue is to figure out probable financing using multiple strategies that we are working on to get drivers into electric vehicles and there is no doubt that drivers will be more gainfully employed and make better incomes,” Sam Faleye said.

Compared with the financing model of regular vehicle financing companies like Lagos Ride and Moove, this seems an inviting option.

For example, with Lagos Ride, the maximum repayment time frame is four years. Drivers are also not allowed to complete repayment until after the first two years. Moove’s repayment plan ranges from 18 months to four years.

Hence, a vehicle financing plan with up to seven years of repayment plan looks great. This is because repayment would be better spread out and would not put much strain on the driver’s earnings. Therefore, it guarantees better earnings for the driver, especially during the repayment period.

Are electric vehicles best for ride-hailing?

The largest ride-hailing company in the world, Uber, certainly believes electric vehicles are the best for the industry. Thus, the company has set a deadline of 2040 for every vehicle operating on its platform to be electric.

See also: Uber to deploy 100,000 new electric vehicles to its global markets excluding Africa

It is important to note that rather than electric vehicles, what appears to be the national focus at this time is a shift to compressed natural gas (CNG) powered vehicles. There are valid reasons for this focus from both the government and the drivers.

For the drivers, a switch to a CNG-powered vehicle is better because it is closer to the internal combustion engines with which they are already familiar. Also, conversion to CNG will make their vehicles a hybrid. Hence, if CNG is unavailable, they could switch to regular PMS.

For the government, apart from cushioning the effects of skyrocketing fuel prices, it would also increase the market for one of Nigeria’s most abundant natural resources, gas. This explains why the government is offering up to 50 per cent financing for e-hailing drivers who are looking to switch.

But, there is no such discount for drivers willing to switch to electric cars and this is for obvious reasons. But the SAGLEV CEO believes drivers have to strongly consider making the switch by themselves for good reasons.

“By direct partnership and allowing some drivers to use our vehicles in Ghana and Nigeria, we have shown clearly that, for example, a Suzuki Espresso or Alto would cost about 10,000 naira for power daily for less than 200 kilometres for an Uber driver. Electric power will only be no more than 2,500 naira at today’s electric tariff rate or less. For the LagRide driver, they are paying 17,000 to 20,000 naira a day. Compared to 2,500 to maybe 3,000 a day, the argument is settled. So therefore there is no reason why this should not work and we have primarily tested this,” the SAGLEV CEO said.

He added that electric vehicles have the unique advantage of having a longer life span. The average battery can last for 10 to 15 years, even up to 20 years. Secondly, electric vehicles have a much lower maintenance cost of up to 50 per cent or more, when compared to internal combustion vehicles.

“Electric vehicles last longer and this data is available worldwide. Not only do they last longer, but they experience fewer maintenance visits so the cost of maintenance is lower. And because they have much fewer moving parts, the amount of time you spend on repairs is much less. Therefore you can work longer,” Sam Faleye said.

He also noted that local electric vehicle manufacturing companies like Saglev, sell vehicles with warranties with a service plan through their maintenance shops.

On the question of charging, Sam Faleye pointed out that his company has developed charger banks across various parking lots in Lagos. Each location has up to 20 to 100 points.

The first of these parking lots would be at Mega Plaza in Lagos. The Palms will also be coming up as the company aims to have them all over Lagos. He noted that a full charge takes 4 hours which would give 325 kilometers.

“So we recommend for them to charge over four hours, take a four-hour break, by the way, there is no Uber driver from our data that has ever driven more than 220 kilometres a day. The car itself has a 325-kilometre range. So for one whole day, you are not going to finish the 325 kilometres anyway,” he concluded.