Diversified vehicle company Zeda hit a bit of a speed bump on listing on Monday, dropping 7%. The spinoff of the diversified vehicle rental and leasing operation will enable Barloworld, a global industrial processing, distribution and services company, to refocus on its core businesses: earth-moving equipment and consumer businesses.

It’s a homecoming for Zeda, Africa’s largest and only integrated mobility solutions provider, explains CEO Ramasela Ganda, who is leading an executive team dominated by strong women – not only in human resources but in key positions, from finance to sales and operations.   

Ganda, a chartered accountant, has extensive experience at Vodacom, Telkom and the National Nuclear Regulator. She joined the Barloworld Group in 2017 as the chief financial officer for Barloworld Equipment: Rental and Used, and as executive head of business services.

She took over the hot seat at the Avis Budget Group in April 2020, a few days after lockdown, steering the car rental company through its troubles during the pandemic.

On 28 November, the JSE approved Zeda’s listing, subject to the company obtaining the requisite spread of shareholders as required by JSE Listings Requirements.

Visit Daily Maverick’s home page for more news, analysis and investigations

As the only end-to-end mobility provider offering tailored short-, medium- and long-term car rental and vehicle fleet leasing services in southern Africa, Zeda’s modular offering allows it to meet customer requirements, from driven services to leasing extra-heavy commercial vehicles. 

In a statement issued before the listing, Ganda said: “The listing is a culmination of three years of hard work and dedication to unlock our mobility aspirations for Southern Africa. We foresee a future of usership, where our customers can rent a vehicle from us for a specified amount of time and a set cost. Customers have a vehicle when they need it and don’t when they don’t need it – thereby reducing the overall cost of ownership for the customer.

“We are an ingrained part of southern Africa’s mobility and our ability to leverage our scale and proprietary forecasting abilities make Zeda the natural partner of choice for the future of mobility in southern Africa.”

Ganda told Business Maverick that Zeda foresees a future of usership, as opposed to ownership. 

“When we grew up, we all wanted to buy cars. The moment you get a job, you buy a car, but when you look at transportation challenges, we have to think differently about simple ownership of cars, and tying up your capital on something that, as we all know, depreciates the moment you drive out of the dealership. But we still buy it.”

Does that mean we don’t understand the economics of a car, or does it mean that we do not have an option? Ganda believes Zeda has the answer: it offers customers an alternative so they don’t have to worry about the depreciation of a car because they don’t own it in the first place. 

“Zeda knows how to ensure that a car generates a good return. All that a consumer needs is access to a vehicle. If we have not learned anything from Covid – paying insurance and maintenance on a vehicle [that you don’t drive], then I think we still have somewhere to go.”

Covid presented an opportunity for Zeda, she explains, to roll out its  subscription model, which relieves the customer of the burden of its depreciation while having access to the car. 

The model allows customers to use the vehicle on a variable basis, from a single day to 24 months. “It’s a usership economy; just the right to use it. It’s transformative.” 

It also puts them in direct competition with the banks, whose customers think they own a vehicle, but at the end of the loan period – which can stretch into 96 months – they are faced with a residual balloon payment of up to 35%. So, do you really own the vehicle, she asks. 

Zeda is still focussing on selling good, second-hand cars, but the subscription model allows customers to switch up, or down, as much as they like. 

“One month you could drive a BMW, the next, a Haval, the next, a hybrid or even an electric vehicle (EV). You can change it every month and you have the flexibility. Those are the things we will be bringing into the market soon. We already have hybrids … next, we’ll be bringing in EVs, so that customers can have options.”

If anything, listing on the JSE is just the right opportunity for Zeda to access capital: Ganda says they are excited about the future because as a listed entity, they now have access to new pools of capital, guided by their own allocation strategy geared toward not only shareholder growth but also economic growth. 

“Our focus will be on accelerating the usership economy, improving and expanding our offering, and digitising our business process to improve customer experience.” BM/DM