When Little Cabs, a taxi hailing service was launched two weeks ago by Safaricom, their cheap charges and good incentives to drivers posed as a challenge to Uber. While Uber was charging Ksh.60 per KM and Ksh.4 per minute Little Cabs charges are cheaper; a minimum of Ksh 270 and a cost of KSh 55 per kilometer or Ksh 4 per minute. Additionally, Uber has a base fair of Kshs 100 while little cabs does not have.
To ensure that Uber remains significant in the market, they have announced a 35% reduction on their prices on rides within Nairobi City. This will see their charges per KM dropping by Ksh 30, charges per Minute dropping by Ksh 1 while the base fare remains at Ksh 100.
This move come after their partnership with Total Kenya and CDN in aim to enhance efficiency and reliability in their services provision to the driver-partners and riders.
|Description||New rate (kshs)||Old rates (Kshs)|
Also Read: 10 Things You Must Know About Little Cab
Since Uber was launched in Kenya, it has been registering 100, 000 new users monthly with over a million trips to different destinations.
Uber are delighted to report that they have created over 1000 economic opportunities in Kenya since its inception in 2015. However, they are targeting more than 3,000 economic opportunities at the end of 2016.
When asked why they decided to lower their prices, Nate Anderson, Uber’s GM for East Africa said that it’s a strategy to attract new market and to reach many people as they fulfill their mission to ensure that people reach to their desired destination in a safe, reliable, affordable and convenient way of transportation.
“We believe these changes will help, but while the city adjusts to the new prices, we are putting in place minimum payment guarantees for drivers to ensure they don’t lose out. And if the amount they make on the road isn’t what we expect, we’ll reassess this price change,” said Nate Anderson.
Uber pointed out that they have not reduced their rates because of their competitors but given the fact that Little Cabs offers quite cheaper services compared to Uber, it might have contributed in decision making of cutting charging rates.