@BusinessDaily

Uber, Taxify riders to pay more in new tariff plan

2 months ago, 11 July 19:00

By: Annie Njanja

Kenya’s taxi users are facing increased fares following the signing of an agreement between the drivers and the e-hailing firms that establishes the Automobile Association (AA) rates as the standard for the cab sector.

Adoption of the AA rates is expected to automatically increase the cost of rides. The AA rates stand Sh26 per kilometre for vehicles with engine capacity of between 850cc to 1050cc and Sh42 per kilometre for 1050cc to 1300cc cars.

The association recommends Sh45 per kilometre for 1300cc to 1500cc vehicles and Sh58 per kilometre for 1500cc to 1800cc vehicles.

Uber, for instance, has a bias for cars with an engine capacity of 1300cc, meaning that the price per kilometre will shoot to more than Sh42 after profit margins are factored in.

This leaves riders with an imminent price increase, a move meant to accommodate the drivers' demand for better pay. Notable is that the Memorandum of Understanding (MoU) does not make it mandatory for digital taxi providers to set new rates.

Uber charges the highest commission at 25 per cent, charging riders Sh16 per kilometre for Uber Chap Chap and Sh27 per kilometre for UberX.

TaxifyGo, another popular taxi-hailing service, charges Sh22 per kilometre and takes 15 per cent commission. Little charges Sh35 per kilometre and takes away 15 per cent in commission too. The apps also have a set base fare and minute rates for each service.

Transport principal secretary Paul Maringa said a Memorandum of Understanding (MoU) signed yesterday between Uber, Little, Pewin Cabs, Taxify, Fone Taxi and drivers' lobby Digital Taxi Forum was expected to end the industrial action that has rocked the sector in the past two years.

“Price considerations per kilometre by DATP (Digital App Taxi Providers) will be guided by the average operating vehicle cost and classification of vehicles as provided by the Automobile Association of Kenya guidelines,” said Mr Maringa.

The MoU laid out pricing methods, quarterly stakeholder meetings, conflict resolution and security measures that require taxi app providers to offer quick response to drivers in danger.

There are claims that about 20 drivers have been murdered in the line of duty and no immediate response was provided. “We are happy that the signing of the agreement has happened. This now provides an opportunity for the drivers and the taxi apps to meet and resolve matters. We are expecting to sit down and review the rates,” said Digital Taxis Association of Kenya chairman David Muteru.

The association is among two other groups under the lobby that is representing the drivers.

Ride Share Sacco Society, Digital Taxis Association, and Public Transport Operators Union were allowed to raise issues and propose how to resolve the concerns after last week’s strike.

They complained over low fare charges by digital app companies without any consultations with the drivers and third party owners and collusion by big operators to use low pricing to kick out competitors.


Read More


Category: business opinion news lifestyle corporate

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Uber, Taxify riders to pay more in new tariff plan

2 months ago, 11 July 19:00

By: Annie Njanja

Kenya’s taxi users are facing increased fares following the signing of an agreement between the drivers and the e-hailing firms that establishes the Automobile Association (AA) rates as the standard for the cab sector.

Adoption of the AA rates is expected to automatically increase the cost of rides. The AA rates stand Sh26 per kilometre for vehicles with engine capacity of between 850cc to 1050cc and Sh42 per kilometre for 1050cc to 1300cc cars.

The association recommends Sh45 per kilometre for 1300cc to 1500cc vehicles and Sh58 per kilometre for 1500cc to 1800cc vehicles.

Uber, for instance, has a bias for cars with an engine capacity of 1300cc, meaning that the price per kilometre will shoot to more than Sh42 after profit margins are factored in.

This leaves riders with an imminent price increase, a move meant to accommodate the drivers' demand for better pay. Notable is that the Memorandum of Understanding (MoU) does not make it mandatory for digital taxi providers to set new rates.

Uber charges the highest commission at 25 per cent, charging riders Sh16 per kilometre for Uber Chap Chap and Sh27 per kilometre for UberX.

TaxifyGo, another popular taxi-hailing service, charges Sh22 per kilometre and takes 15 per cent commission. Little charges Sh35 per kilometre and takes away 15 per cent in commission too. The apps also have a set base fare and minute rates for each service.

Transport principal secretary Paul Maringa said a Memorandum of Understanding (MoU) signed yesterday between Uber, Little, Pewin Cabs, Taxify, Fone Taxi and drivers' lobby Digital Taxi Forum was expected to end the industrial action that has rocked the sector in the past two years.

“Price considerations per kilometre by DATP (Digital App Taxi Providers) will be guided by the average operating vehicle cost and classification of vehicles as provided by the Automobile Association of Kenya guidelines,” said Mr Maringa.

The MoU laid out pricing methods, quarterly stakeholder meetings, conflict resolution and security measures that require taxi app providers to offer quick response to drivers in danger.

There are claims that about 20 drivers have been murdered in the line of duty and no immediate response was provided. “We are happy that the signing of the agreement has happened. This now provides an opportunity for the drivers and the taxi apps to meet and resolve matters. We are expecting to sit down and review the rates,” said Digital Taxis Association of Kenya chairman David Muteru.

The association is among two other groups under the lobby that is representing the drivers.

Ride Share Sacco Society, Digital Taxis Association, and Public Transport Operators Union were allowed to raise issues and propose how to resolve the concerns after last week’s strike.

They complained over low fare charges by digital app companies without any consultations with the drivers and third party owners and collusion by big operators to use low pricing to kick out competitors.


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