Mobility company Uber via an email recently disclosed to its drivers that it was increasing its fares in Lagos.
The company disclosed that this increase in price was necessitated by unfriendly economic conditions, coupled with the increase in the price of fuel which will take effect on October 3, 2022.
According to the email sent, the base fare will increase from ₦340 ($0.78) to ₦450 ($1.04), while the minimum and per minute fare will go from ₦600 ($1.38) to ₦650 ($1.50) and ₦14 ($0.03) to ₦16 ($0.03), respectively.
This is not the first time the mobility company is increasing its fare, it should be recalled that on May 10, 2021 Investors King reported that Uber was increasing its fares by 13 percent in Lagos. According to the company, the increase was to ensure a reliable earning opportunity for driver-partners.
However, the company’s recent decision to once again increase its fares in Lagos may come as a surprise to users but it is in line with its activities in other countries where it has operations.
Lagos is not the only city that has witnessed an increase in fares. In August 2022, Bloomberg reported Uber was increasing its fares in London by 5%, with plans to do the same in other cities across the United Kingdom.
Uber has not been the only ride-hailing player to increase its prices. A report by Rakuten Intelligence revealed that the cost of a ride on ride-hailing apps had increased 98% between 2018 and 2021, driven partly by a shortage of drivers.
But in recent times, the company has begun pushing for profitability. In an email to employees in May 2022, CEO Dara Khosrowshahi said, “we have to make sure our unit economics work before we go big.” The result of that has been an increase in fares.
However, in 2017 Uber reduced its fare shortly after Taxify, a growing competitor did the same. The company sent a message to its drivers via a mail which reads, “As of today, Uber has reduced fares by 40% in Lagos. This means you can travel for business or explore your city for less than ever before”.