Logistics startup adapts to EV wave in Philippines

By Miguel Hanz L. Antivola, Reporter

THE logistics landscape is rapidly evolving, with sustainability and eco-friendly solutions becoming paramount, according to an industry player.

Amid this shift, entrepreneur Dennis O. Ng, who had already marked his presence by establishing an on-demand delivery and logistics services business, sought further avenues for growth.

Late 2021 marked a shift for Mober Technology Pte., Inc., Mr. Ng’s six-year-strong startup at that time, when he was tapped and challenged to provide electric vehicles (EVs) for a foreign client’s delivery.

It became inevitable for the company to pioneer a new submarket and re-fleet toward EVs as the demand for green logistics among multinational companies also started to grow, Mr. Ng, founder and chief executive officer of Mober, said in an interview with BusinessWorld.

“I was able to find two EVs at that time. That’s where we all started,” Mr. Ng said on IKEA Philippines contacting Mober to start the Scandinavian furniture chain’s EV delivery.

Georg Platzer, IKEA Philippines store manager, reached out to Mober in May 2017 after seeing the company at an event by the Philippine Retailers Association, Mr. Ng said.

Starting with just two, Mober later doubled down on EV operations by continuously expanding its fleet, which now consists of 60 EV vans and trucks, Mr. Ng noted.

“Multinational companies are really gearing toward transitioning to EVs because they have a corporate mandate that they need to be net zero by 2030, 2040, or 2050,” he said on servicing Nestlé, Unilever, SM Appliance, Nespresso, and IKEA Philippines.

Chinese automotive group Dongfeng Motors launched in the Philippines on Monday, following a partnership with Legado Motors, Inc. to distribute EVs in the country.

The country needs to reduce its greenhouse gas emissions by 75% by 2030, Philippine President Ferdinand R. Marcos, Jr. said during the launch event.

Mr. Marcos in January issued an order temporarily lifting tariff rates on certain electric vehicles such as passenger cars, buses, minibuses, vans, trucks, motorcycles, tricycles, scooters and bicycles for a five-year period.

He also cut tariffs on certain EV parts and components to 1% from 3%.

Terry L. Ridon, convenor of InfrawatchPH, said the main challenge now of lobbying for EV is encouraging US, European, and Chinese EV manufacturers to set up manufacturing hubs in the Philippines to serve the Asia-Pacific market, BusinessWorld reported in May.

According to the Energy department’s roadmap for the EV industry, the Philippines aims to electrify 10% of its total fleet across all sectors by 2040.

ACQUISITION, OPERATION
Mr. Ng noted that customer benefits gained from a shift to EV delivery include zero carbon emissions.

“The current EV now is still two times more expensive than a vehicle with an internal combustion engine that uses gas or diesel,” he said on a diesel-run delivery van worth P800,000 being equivalent to P1.9M if electric.

“There’s a big difference in acquisition cost. There’s an upfront cost,” he said. “However, on the operations and maintenance, it’s very cheap.”

Mr. Ng said that the company only spent P3,000 for the maintenance of one EV.

“Hopefully, enterprises will realize sustainability has a cost also,” he added on contributing to the decrease of carbon emissions.

CHALLENGES
Mr. Ng noted that the biggest challenge he encounters now in terms of pushing the EV logistics market is the lack of commercial banks willing to finance commercial EVs.

“We’re talking to the Development Bank of the Philippines and the Land Bank of the Philippines now. We have an application with them,” Mr. Ng said.

While Mr. Ng is thankful for government regulations granting traffic leniency for Mober’s EV vans and trucks, he said that the biggest support the company gets is coding exemption.

“We can travel seven days a week. That one day extra revenue for us is quite significant,” he said.

“I’m still lobbying with the government if they can also remove the truck ban,” he added, citing that traffic enforcement of local government units fine the company’s six-wheeler EVs a one-day pass worth P600.

“The load of our EV is a lot lighter than a diesel six-wheeler,” he said. “There is also no noise and air pollution.”

“I hope LGUs and their special operating units can understand and help us be exempted.”

OUTLOOK
Mr. Ng has plans on building charging points in Cavite and Bulacan, aiming to electrify the 1,000-kilometer logistic route from Manila to Tacloban and further overcome range anxiety, he said.

“Logistics or commercial EV will come first before personal,” he noted on the future of EV in the country.

“I hope that our government also has the same mindset as China, US, and Europe, whose governments started funding and building charging stations first before they encourage us Filipinos to buy an EV.”

In terms of increased adoption of green logistics, he said that the Philippines is catching up, amid faster strides from countries in the region.

“I think Thailand is a little bit faster than us, but we’re there,” he said. “Thailand has the supply chain for the automotive industry since most of the Chinese manufacturers are going there.”

“I am hoping that the government can give us more concessions and exemptions.”