Jumia bets on change of its fleet to EVs to cut prices

Jumia has been implementing several measures that seek to cut costs and drive efficiency. Photo / File
What you need to know:
- Jumia says the move is one of the measures through which it will lower operational costs and reduce the prices of goods purchased via its platform
E-commerce firm Jumia has said that it will explore the possibility of shifting its fleet to electric-powered vehicles for delivery of goods.
The move, Jumia says, is one of the measures through which the e-commerce company will lower operational costs and reduce the prices of goods purchased via its platform.
Mr Vinod Goel, the chief executive of Jumia East Africa, which includes Uganda and Kenya, said the plan will cut the cost of logistics by up to 40 percent, allowing consumers to enjoy price cuts on products purchased via Jumia.
The company factors in logistics costs when pricing goods.
Jumia is joining other firms that are exploring the possibility of greening their operations by gradually phasing out petrol and diesel-powered vehicles from their fleet.
“I would be happy if we replace a third of our vehicle fleet with EVs in the next six months. This will reduce our logistics costs and it is key to making our business more sustainable, costs-wise and environmentally wise too,” Mr Goel said.
“If we shift to EVs, fuel costs for our 3PLs (third party logistics partners) will fall by between 30 to 40 percent, and to the consumers, prices can fall by around three percent.”
In September 2022, Jumia announced a partnership with California-based EV solutions provider Biliti Electric to pilot the electrification of its delivery fleet in Kenya, after which it would be implemented across the e-commerce’s operations in Africa, including in Uganda.
The push to transition to electric vehicles in Uganda continues to gain traction with both government and private entities putting in place infrastructure to support the transition.
Government, under the National e-Mobility Strategy, has indicated that together with the private sector and other stakeholders, it will establish at least 3,500 e-mobility public charging stations by 2040.
The plan, in which more than 10,000 fast chargers - with a charger in every 50-kilometre radius – seeks to enhance Uganda’s e-mobility agenda, through which e-charging stations will be established at all government ministries, departments and agencies and strategic public spaces and fuel stations.
Government has already registered progress in the motorcycle sector creating hundreds of e-charging stations.
For instance, Zembo has a network of 27 electric motorcycle battery swapping stations around the Greater Kampala Metropolitan Area, with plans to expand to 50.
Bodawerk, has built a swapping station network of more than 60 stations under the brand name Gogo, while Nexus Green, through the Green Hub Kampala Consortium, is planning to design and install solar, inverters, and battery charging stations to charge electric motorcycles.
Under an already-approved Presidential Directive, Nexus Green is also planning to install solar streetlights that can be used as charging points for electric motorcycles.
Jumia incorporates third parties as part of its transport service providers for last-mile delivery of goods in all its African markets in 2020.