Uber defends price cuts as drivers gear up for boycott

Online taxi hailing firm Uber has defended recent price cuts, saying they are intended to attract more customers on its platform.

The San-Francisco-based firm says that since the 35 per cent price cut came into effect last July the firm has seen an increase in the number of trips by new and old customers.

The tech firm was responding to the Monday switch-off by its drivers and the looming threats to cripple services in Nairobi and Mombasa starting tomorrow.

The taxi drivers plan to hold a three-day demonstration to force the American firm to cede to their demands. They are demanding that Uber increases the fares payable by customers and reduces the 25 per cent commission it deducts from their total earnings to increase their take home.

“Time and again we have seen that price cuts result in more people wanting to take trips with Uber. That’s good news for driver-partners who spend less time waiting for fares and more time earning,” said Janet Kemboi, Uber East Africa spokesperson.

“Uber has reduced fares in many other countries across the world and the impact has almost always been an increase in the number of trips by new and existing riders and, in many cases, higher than average net earnings for driver-partners.”

The Monday strike by Kenyan drivers is only the latest to hit the firm after similar industrial action paralysed its operations in India and Qatar last week.

The drivers both in Mombasa and Nairobi have threatened to switch off their devices and take to streets for three days (Thursday, Friday and Monday) until Uber addresses their complaints.

“We have no desire to abandon duty and demonstrate. All we are asking from Uber is a chance to talk and bridge this gap. They lowered the prices without seeking our consent and we are asking them to review them up failure to which we are going to paralyse their service until come up with a formula that does not dent our pockets,” said David Muteru, chairman Digital Taxi Association of Kenya on Monday.

TAXI PLAYERS

Last year, Uber cut prices to Sh35 per kilometre down from Sh60. It also reduced its charges per minute by Sh1 to Sh3 and cut the pricing of short rides by Sh100 to Sh200 while base fare remained unchanged at Sh100.

The association plans to petition the government through Parliament to set up a body that will oversee the operations of the traditional and digital taxi players in Kenya if Uber does not reduce the commission and raise the prices. The group joins other city taxi drivers who had petitioned MPs two weeks ago, asking the lawmakers to intervene and set a price for various destinations that have to be observed by all players. James Mahianyu, association’s analyst, says Uber has dismissed call for talks, however, Ms Kemboi insists that Uber is open for discussion.

“Anyone can speak to us at any time and there are a number of ways drivers can speak with us. Uber succeeds when our partners succeed so our teams are working hard everyday to find even more ways for drivers using the app to thrive,” said Ms Kemboi.