Entrepreneurship Zone: 03 March 2023 :: South African electric delivery vehicle poised to enter European market

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Entrepreneurship Zone: 03 March 2023 ::  South African electric delivery
vehicle poised to enter European market

 

	
 


*          


MellowVans, a South African business that specialises in manufacturing
light electric vehicles, has taken a major step in expanding its reach. The
company recently exported its first test vehicles to Europe. MellowVans has
already established a strong foothold in its home country, counting courier
companies and retailers among its clients. To learn more about the company’s
journey and future plans, Jeanette Clark spoke with founder and director
Neil du Preez.


In 2014, South African Neil du Preez took a sharp turn on his career path.
He had been living abroad, working as a commodities trader and had a
background in chemistry, but an idea took hold to create a small
three-wheeled electric vehicle, and it would simply not let go.

One thing was clear to Du Preez, while it had to be small and nimble, it
could not look like a tuk-tuk (the auto rickshaw vehicles so prolific in
East Asia). “That design had gotten stuck in the 1950s, we wanted something
modern,” he says.

The original idea, when he moved to Stellenbosch in South Africa, was to
design a light electric vehicle for passenger transport. The company,
MellowCabs, was established and started gaining some media attention for its
use of recycled material and environmentally friendly approach.

By January 2015 the company had built eight prototypes that were visible on
the roads, creating a steady trickle of interest from advertisers and public
transport providers.

The company was still continuously evolving its ideas around the design and
materials used. At one stage the cab even featured a flexible solar panel on
its roof.

A major turning point, however, was when Du Preez and his team realised in
2019 that the use case for the vehicles had much more potential when it
comes to parcels and cargo.

“There was a moment where the managing director of courier company DHL said
to me: ‘Convert one of these into a delivery vehicle and we will test it for
you,’” says Du Preez. “In retrospect that was a major pivotal point for our
company.”

MellowCabs changed its name to MellowVans and DHL started using them.
Today, there are MellowVans throughout South Africa and some vehicles can be
found in Namibia and Botswana. Now Du Preez and his team have their sights
set on Europe.


Rethink and redesign


MellowVans was establishing itself as a partner for last-mile deliveries
when the global pandemic hit. If home delivery was a rising trend before, it
suddenly became a necessity for people stuck at home. “Retail home delivery
exploded, which was a very good thing for us,” says Du Preez.

The company realised that there was a big international market for electric
three-wheelers for cargo delivery. It used the first couple of months of the
pandemic to relook its design, considering changes that would be appropriate
for use if the vehicles were sold in Europe.

Du Preez and the team also considered the European homologation
requirements. Before a vehicle can be sold in the European market, it has to
undergo rigorous testing and the redesign was the ideal time to address some
elements that would help with final approval.

Although various international components have been added to the vehicle,
Du Preez notes that over 60% of the build still consists of locally sourced
South African parts.

Production of the redesigned vehicle commenced in January 2022 and today
the company has homologation pre-approval for Europe, hoping to finalise the
process in the next couple of months.

“We have test vehicles on the ground in the Netherlands with DOCKR, a
mobility supplier, and in Belgium with DHL Europe,” says Du Preez. “Next up
is France and Germany.”

With the redesign, MellowVans also looked at the suspension requirements
for its new markets, adjusting it to navigate the cobblestone surfaces found
in Belgium, specifically.

MellowVans have a cargo capacity of 2.5 cubic metres, far exceeding that of
motorcycle delivery vehicles. The top speed is electronically limited to
60km/h, and it has a range of 130km. All vehicles come with an onboard
charger and can be fully recharged in four hours.


Leasing and maintenance


Any maintenance is covered under the company’s leasing offer. It no longer
sells the vehicles to its clients.

“Most of the maintenance that we have to do are things like windscreen
wipers, tyres, side mirrors, not really any technical work,” says Du Preez.

The two- or three-year lease includes the functionality of a full
internet-of-things system which enables clients to track the deliveries
made.

No deposit is required, and full insurance is included.


Ramping up production


Hardware manufacturing is expensive, says Du Preez. “We don’t qualify for
tax incentives under the South African Automotive Production and Development
Plan (an incentive scheme) as we don’t produce 50,000 units and more per
year. We had to find funding wherever we could,” he says.

Initially, MellowVans received financing from an angel investor as well as
“friends, family and fools”, as Du Preez puts it.

Thereafter the company qualified for funding from South Africa’s Industrial
Development Corporation and just recently it closed its first Series A
funding round with a consortium of South African investors.

MellowVans has made considerable investments to increase its production
volumes. “Previously we could manage one vehicle per day, from April we will
be up to four per day,” says Du Preez. “By August, it will be 10.”

The demand for the vehicles has always outstripped the supply. MellowVans
could simply not produce enough units to supply both South Africa and
Europe. The plan is to ship the fully built models to European clients as a
start, moving towards local assembly in the destination market as soon as it
makes sense from a price point approach.

“We are using European components in the vehicle, so we would have to have
local assembly there. We are looking at possible locations in the
Netherlands, Hungary, as well as Egypt.”



- Howwemadeitinafrica

 

 


 


 


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