11 September 2017

Tanzania: Uber Creating Jitters As It Overtakes Taxi Business in Tanzania

Uber is a transport service offered through a mobile phone application. It was launched in Dar es Salaam on June 16, 2016, being the 475th city to use Uber as an alternative form of transport.

"We are proud to launch Uber in Tanzania at such an exciting point in this growing economy. As the infrastructure of Dar es Salaam rapidly urbanises, so the demand for affordable, easy and flexible transport grows. Uber will create this solution. We have set the standard for connecting people to world-class affordable and reliable rides at the touch of a button.

Our service complements existing transport options, so we can all work together to reduce traffic congestion and the environmental impact of transport in the city," says Alon Lits, Uber General Manager in Sub-Saharan Africa, in a statement during the launch.

Boarding experience

When one opens the Uber app from anywhere in Dar es Salaam, he can check on a driver who can, in turn, accept the request. The would-be passenger can see a cost estimate of the trip, the driver's first name, photo and license number of the vehicle. The driver also sees his rider's photo and name.

The rider/driver can also check whether others had a good experience with the driver. A driver can also have this information.

"With Uber it's easy to calculate your daily transport costs. I think the cost estimate is fair and standard compared to when we had to board taxis going to a similar destination but paying a different unreasonable price. It's also comfortable, predictable and guarantees safety," says Kassim Mwanahonda, a regular Uber rider.

He also applauded the feedback system that both the customer/driver are required to provide to Uber after the ride. He believes it's a way of ensuring accountability.

Business side of it

Uber has given drivers a chance to take out the hassle of looking for passengers. It has made them flexible and independent.

"The arrangement Uber has with a driver is one that is contractual and not an employer-employee relationship," says Alfredo Msemo, Uber country manager.

He further elaborates that a driver just pays user fee for utilising the technology that is 25 percent of his earnings.

"I have ridden in many Ubers whereby a driver is a full-time employee. So, as he is on his way to work in the morning he switches on his Uber and picks customers that are heading to his destination likewise in the evening as he heads home," says Janet Mbelwa, a regular Uber rider.

"Uber has created more than a 1,000 economic opportunities. These are people who are either driving part-time or full time or involved somewhere in the value chain," says Alfred Msemo.

Riders are charged Sh466 per kilometer or Sh45 per minute.

Taxi competition

Uber got a warm welcome from the residents of Dar es Salaam but how are the taxi drivers taking it?

Places like the airport, taxi drivers are still chasing and attacking Uber drivers.

They are doing this believing that they are sabotaging their business. In the past, one would take a taxi from the Airport to Masaki for Sh60,000 but today you could make the same trip for a cost of between Sh7,000 and Sh10,000 only.

One of the taxi drivers stationed at the airport, Mbwana Mohammed, says: "I have seen and heard other taxi drivers complain about the low price deals and upon seeing such a challenge, I decided not to join the Uber system. For example, one might request an Uber at the airport to be taken to Masaki or Kariakoo. Uber would charge Sh10,000 out of which Uber gets a 25 percent cut. On top of that I still have to burn gas and head back to my station (airport). Who do you think is at loss and who do you think is making profit?"

Dar es Salaam is not the only place that Uber has faced such challenges. It has received worse setbacks in cities like Nairobi, Mombasa, Paris, Nice and Johannesburg, whereby there were violent anti-Uber protests and riots.

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