Ride-hailing boom drives Africa's green transition

The rapid expansion of motorcycle and three-wheeler ride-hailing services across African cities is emerging as a major driver of the shift to cleaner transport, creating a growing market for electric mobility companies.

Platforms such as Uber and Bolt have expanded motorcycle and three-wheeler services in Kenya, Uganda, Rwanda and Nigeria, bringing thousands of commercial riders into structured transport networks and generating relatively predictable demand for vehicles.

This trend gives electric two — and three-wheelers a practical entry point into Africa's transport market. Motorcycles and tuk-tuks (three-wheelers) already play a central role in passenger and goods transport across the continent, making them among the most accessible segments for electrification.

The Rocky Mountain Institute, or RMI, a United States-based clean-energy research organization, said the sector could help African countries accelerate the transition while tackling rising transport costs and urban air pollution.

Dustin Kahler, an electric-mobility industry adviser at Upeo. Earth, a Nairobi-based energy and mobility advisory firm, attributed part of the growth in East Africa to early investment, government incentives and rising demand from ride-hailing companies.

"Fiscal incentives from governments in Rwanda, Kenya and Uganda played a big role in the uptick," he said, adding that companies including Greenwheels, M-KOPA, Bolt and Uber provided "early proof points" that helped move the market forward.

Kahler said the experience showed that electric two — and three-wheelers could move beyond a niche technology and become part of mainstream urban transport.

"For African countries, the experience offers lessons not only in cleaner mobility but also in how electrification can support industrial development, job creation and energy security," he said during a webinar.

The economics are particularly attractive for commercial riders, who cover long distances and are highly exposed to fuel and maintenance costs.

Kahler said commercial electric-vehicle operators in East Africa could save between 30 and 40 percent in total cost of service. The high cost of capital, however, remains a major obstacle to wider adoption.

"While electric motorcycles generally cost more upfront than petrol-powered models, their lower energy and maintenance costs can reduce operating expenses over time," he said.

Kenya's experience illustrates how government and industry cooperation can help build the market.

Cynthia Kipsang, a technical adviser at GIZ Kenya, said the country's progress reflected closer collaboration between policymakers and businesses, with both sides increasingly viewing e-mobility as an opportunity for industrial development, job creation and energy security.

GIZ Kenya is Germany's main development agency that supports Kenya's transition to electric mobility and sustainable urban transport.

Policy discussions

She said involving private companies in policy discussions from the beginning has helped ensure that regulations reflect conditions on the ground and address practical challenges facing the industry.

Kenya is also attracting a new wave of electric-vehicle manufacturers following the rollout of a shared battery-swapping network.

Kenya's Ministry of Roads and Transport records indicate the country has cumulatively registered 39,324 electric vehicles, up from 1,378 in 2022, with two-wheelers recording the highest percentage increase.

Nigeria faces a different set of challenges, with its vast commercial transport sector constrained by limited charging infrastructure and persistent electricity-supply challenges.

RMI said solar-powered charging stations and battery-swapping networks could help reduce dependence on unreliable grids while creating investment opportunities in clean energy and transport infrastructure.

Habib Nuhu, a Nigerian market intelligence and research manager at the Shell Foundation and specialist in energy transition and development, said greater access to domestic capital would also be critical, particularly from local banks and pension funds.

For riders, financing remains a key barrier, with Greenwheels Fleet Management's Kenya head, Arturo Osorio, saying lowering the upfront cost of electric motorcycles will be crucial to wider adoption.

He pointed to lease-to-own financing as one model that could allow more commercial riders to eventually own their vehicles.

"One of the innovations for us that was critical in helping us really scale in Kenya and the other two markets we operate in was introducing the lease-to-own structure," Osorio said.