The fare dispute between ride-hailing companies and their driver-partners in Kenya has escalated, with drivers now taking a stand by setting their rates and refusing service to passengers who disagree with the new prices.
This conflict is not just about fares, but it’s a battle for survival, as it underscores the growing tensions over compensation amid rising living costs.
In Nairobi, drivers for platforms such as Uber, Faras, and Bolt have begun displaying signs in their vehicles demanding fare increases.
“We, as Nairobi online drivers, wish to notify the public that due to the high cost of living, we will not be able to operate under the current rates of Uber, Faras, and Bolt,” reads one such sign.
The drivers have not just raised their concerns, but they have also proposed new fare structures that they believe are necessary for their financial sustainability.
They are advocating for an increase in the minimum fare from $1.40 to $2.33. According to Dennis Nyariki, deputy chairman of the Organisation of Online Drivers Kenya (OOD), the current rates do not cover the cost of fuel, driver compensation, and other expenses.
Nyariki argues that trips over $2.32, covering more than 3km, should have fares multiplied by 1.5 to reflect actual costs.
In addition, drivers have set new rates for airport and railway station pickups and drop-offs, ranging from $7.75 to $38.76.
These charges are now higher than a train ticket from Nairobi to Mombasa and nearly half the price of a flight to the coastal city.
An analysis by AA Kenya, a mobility solutions firm, indicates that the current rates should be at least $0.26 per kilometre when maintenance costs are factored in.
Drivers are seeking fare hikes to improve their earnings amid increasing living costs. Still, ride-hailing apps aim to keep fares low to retain price-sensitive customers.
The dispute is further complicated by broader economic challenges, including job cuts, pay freezes, and high inflation, which have reduced discretionary spending on services like ride-hailing. This could potentially affect the availability and affordability of ride-hailing services for the general public.
As a result, the number of leisure rides has decreased, placing additional pressure on drivers.
The situation has escalated to reports of harassment and, in some cases, assault when passengers refuse to pay the higher, unofficial rates.
Ride-hailing companies have responded by agreeing to meet with drivers’ associations to address these issues.
In a statement to TechCabal, Bolt acknowledged the concerns but stressed that unilateral fare increases by drivers lead to inconsistent pricing for customers.
The company is working on a solution to balance drivers’ economic needs with affordable, quality customer service.
Uber also reiterated its stance, stating that requesting additional payments beyond what is displayed on the app violates its Community Guidelines.
The company warned that such actions could result in suspended or banned driver accounts.
Previous negotiations have often ended without resolution, leading to recurring strikes by drivers. These strikes have disrupted the availability of ride-hailing services and inconvenienced passengers, highlighting the seriousness of the dispute.
The current round of talks is expected to involve mediation by the Ministry of Transport and the National Transport and Safety Authority (NTSA).
Suppose the discussions fail to resolve the dispute. In that case, drivers have indicated they will continue to enforce their new fare rates, potentially straining their relationship with the ride-hailing platforms that once sought to attract them. This could lead to changes in the business model of these platforms and ultimately, the services they offer.
