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Uber drivers protest in Nairobi over new discounted fares

BUSINESS
By Moses Michira | August 4th 2016
Uber taxi drivers protest along the streets of Nairobi. They were demanding high rates for their services. (PHOTO: JOHN MUCHUCHA/ STANDARD)

Uber drivers yesterday protested against huge discounts announced by the taxi company following entry into the market by newer rivals.

More than 100 drivers stayed out of work in the morning hours, saying the new rates announced last week were undesirable considering the expenses they had to cover to make a profit.

Commuters however have emerged as the biggest winners in the soaring competition, with fares dropping by as much as a third.

They chanted in protest over the revised rates with some of the protesters holding up placards reading, “We should not be Uber slaves in our own country.”

Yesterday’s protest stemmed from threats issued on Monday by an informal lobby group calling itself the Kenya Digital Taxi Association, over the low fares charged by the virtual cab.

For Uber, it would present the second hurdle after an initial one where its drivers were targeted and assaulted by people thought to be associated with the contemporary taxis.

SEVERE cases

In the more severe cases, cabs operating on the Uber platforms were even burnt.

But some of the 3,000 vehicles registered on the Uber platform however ignored calls to join the protest, which started at the Uber Kenya offices in Westlands Business District and ended in the City Centre.

A commuter who talked to The Standard yesterday said she was “pleasantly surprised” that her one-way trip from Nairobi’s Kenyatta Avenue to Nyayo Stadium cost her only Sh200 for the estimated five-kilometre ride.

In the service agreement, the American-owned firm that owned the mobile application is entitled to a quarter of the revenue generated, Sh50 for this case.

From the ride, the cab driver would keep the Sh150 to meet the various expenses including fuel plus his profit margin.

Nate Anderson, Uber’s General Manager in Kenya, said last Thursday that the lower revenues per trip would be made up for by having more customers on the platform.

“Our experience shows us we can make that happen while making Uber the best way for drivers to earn. This also means riders can ditch their car keys and travel with Uber more often,” he said, adding that using his firm’s application may have got cheaper than using one’s own car.
“This means fewer cars on the road, less traffic, and fewer issues trying to find parking.
“In the revised pricing, the minimum cost of a ride was reduced by a third to Sh200, while the per-kilometre rate was reduced from Sh60 to Sh35.

Mr Anderson also promised that the guaranteed pay for every driver would be maintained, in addition to incentives like a Sh3.50 negotiated discount per litre of fuel.

Uber, the World’s biggest private company and the most successful cab-hailing platform, has been met with severe competition in several markets it has moved to, including Safaricom-backed Little Cabs in Kenya, which set off the ongoing turf war.

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