Just when we thought that it is game on after the recent launch of Little Cabs and other similar ventures, things have taken a completely new twist: Uber has slashed its price by 35%!
The price cuts are only applicable in Nairobi, even though Uber has launched operations in Mombasa and Thika.
The new uberX rates
| Old uberX | New uberX | |
|---|---|---|
| Base | KES 100 | KES 100 |
| Per Minute | KES 4 | KES 3 |
| Per KM | KES 60 | KES 35 |
| Cancellation | KES 200 | KES 200 |
| Minimum | KES 300 | KES 200 |
How do these Uberx rates compare?
| Old uberX | New uberX | |
|---|---|---|
| KICC to Nyayo Stadium | KES 300 | KES 200 |
| Times Tower to UN (Gigiri) | KES 800 | KES 500 |
| State House to JKIA | KES 1300 | KES 850 |
The strategy seeks to counter mounting competition from its competitors. The new charges have taken effect and the implication is that clients will pay Kshs. 35/km down from Kshs. 60. This also includes reducing charges per minute by Kshs. 1 and slashing the prices of short rides from Kshs. 300 to Kshs. 200. These changes will not affect base and cancellation fees which stand at Kshs. 200 and Kshs. 300 respectively.
With the new rates, Uber hopes to ensure customer loyalty and attract new ones. Samantha Allenberg, Uber Africa spokesperson, was quoted saying that the move would positively impact driver-partners as well as clients across Nairobi. She went on to proclaim the company’s passion and commitment to improving client experience.
This is a strategic timing given the increasing competition in the taxi industry. The number of e-taxi haling services has increased over time; hence, there is need to put in place strategic measures to ensure that clients continue to Uber.
The sustainability of this move has been put to question. The taxi-haling service, however, assured its driver partners that they will not be left short as there are payment guarantees in place. This comes with a promise of a review in case the strategy fails to attract more customers and boost earnings.
Going forward, we can only wait to see how the competitors will respond. Nevertheless, it is likely that a price war will intensify as each company seeks to survive in the competitive market. Prime examples of e-taxi hailing services and Uber competitors are Little Cab, Sendy, Taxify, Mondo Ride, Mara Moja, and Easy Taxi Business.
