Wigton buys stake in electric car dealer

Wigton Diversifies into EV Market with Stake in Flash Holdings

Citing a need to diversify, renewable energy company Wigton Windfarm Limited is entering the electric vehicle (EV) market through the acquisition of a stake in Flash Holdings Limited.

Wigton’s 21% stake in Flash, a holding company registered in St. Lucia, will grant it an equivalent share in its subsidiary, Flash Motors Company Limited. The transaction's cost and details about other shareholders in Flash Holdings were not disclosed.

Flash Motors plans to sell EVs in Jamaica, Trinidad & Tobago, and Guyana, according to Wigton Managing Director Earl Barrett. “I am very optimistic that the market will make EV the car of choice in the region, and we want to be a part of that,” Barrett said in an interview with Financial Gleaner.

Wigton will also monitor EV activities in Barbados to assess the market, but the high double-digit EV adoption rates suggest competitive entry opportunities. Barrett declined to disclose the car brands Flash Motors will sell, pending an official press launch later this year. However, he confirmed that Flash would focus on the new car market, avoiding the pre-owned segment.

Global and Regional Trends Favor EV Adoption

Major automakers worldwide are phasing out gas engines in favor of electric batteries, with some targeting complete transitions within two to three decades. While Tesla leads the EV market globally with premium pricing, Barrett noted that Flash’s vehicles would enter the market at more accessible price points.

Jamaica projects EV numbers will grow to 50,000 units over the next decade, comprising about 12% of the country’s vehicles. Currently, the market is small, with only 250 to 300 EVs and hybrids combined. However, the Jamaican government recently announced a reduction in import duties on EVs from 30% to 10%, applicable to 1,000 units, to boost affordability.

Wigton’s Diversification Strategy

Wigton operates a wind farm in central Jamaica, selling electricity to the national power grid. The company’s investment in Flash aligns with its diversification strategy to explore other renewable energy ventures alongside its core wind turbine operations. “The initiative forms part of Wigton’s diversification drive towards other renewable energy ventures to augment its core wind turbine operations,” Barrett said.

The company is also considering establishing EV charging stations, which may involve purchasing electricity from the grid for resale to EV owners.

Addressing Business Challenges

Wigton’s diversification comes amid various pressures, including reduced payment rates from electricity grid operator JPS, declining wind turbine output nearing end-of-life in 2024, and limited opportunities to expand renewable energy capacity since 2016. “Wigton has put renewable energy on the grid, but nothing has happened since 2016. It stands to reason that Wigton had to diversify what we do,” Barrett said. “Wigton has to grow to survive.”

Revenue for the nine months ending December 2021 stood at $1.58 billion, down from $1.94 billion the previous year, with profit halving to $277.5 million from $591.7 million.

By venturing into the EV market, Wigton aims to sustain its operations and contribute to the region’s renewable energy transition.