City transporter launches plan for cheaper fares

Nairobi commuters will enjoy cheaper services after a major public transport operator launched a ticket system that will lower costs by at least 20 per cent in a move that promises to shake-up the sector.

Citi Hopper Ltd, which owns Citi Hoppa buses on Monday launched a pre-paid ticketing system that will see commuters pay a fixed rate of Sh40 per trip on its fleet of 250 buses plying major corridors – Ngong Road, Lang’ata Road, Outer Ring Road, Mombasa Road, and the Jomo Kenyatta International Airport.

This is a reduction from the Sh50 and Sh70 that commuters pay on the routes, a move that is likely to be replicated by its rivals Kenya Bus Management Services (KBS) and Double M as they race to defend and grow their market shares.

Under the Citi Hoppa deal, commuters will purchase a ticket book with 60 leaves for Sh2,400 with their target being the working class.

This represents a 20 per cent and 42 per cent savings for commuters doing two trips a day at Sh50 each and Sh70 respectively.

“We are targeting the working class who pay from Sh60 to Sh70 during the rush hours in the morning and evening,” said Githaiga Weru, operations manager of Citi Hopper.

“The ticket books don’t have an expiry date. One can carry them over to the next month. Similarly, there is no limit to the number of ticket books one can buy within a month,” he added.

The move comes in the wake of rising transport charges driven by expensive fuel, traffic jams and extortion rackets, leading to the doubling of the charges over the past three years.

Kenya National Bureau of Statistics (KNBS) last month reconstituted the consumer price index (CPI) – a select basket of goods and services used to track price movements in the economy — to reflect the current household spending patterns.

Under the new measure, transport now accounts for 8.66 per cent of the CPI up from 5.75 per cent — a pointer that the expenses now accounts for a larger share of the household budget.

KBS said it would react once it can quantify the impact of Citi Hoppa’s move.

“I cannot comment on whether we will react to the Sh40 fares introduced by City Hoppa because we are yet to see the details of their pricing model,” said Mr Edwin Mukabana, the managing director of KBS.

Over the past two years, fares in Nairobi have doubled, with commuters paying anything from Sh50 to Sh100, especially during peak hours when workers go to and return from work .

Transport expenses are among the top three items in the consumer price index (CPI), a measure of the change in prices of goods and services in the economy, signaling the burden households have had to shoulder to travel.

The increase in fares has been prompted by escalating operational costs in the public transport sector which have been passed on to commuters.