Little fares to go up on high fuel cost


Craft Silicon founder Kamal Budhabhatti. FILE PHOTO | NMG

Safaricom-backed ride-hailing firm Little said Wednesday it will raise fares on its platform by Sh3 per kilometre in response to the recent surge in fuel prices that it says has pushed up costs.

The company says it charges it's customers Sh30 per kilometre meaning they will now pay Sh33 per kilometre, according to the statement.

The firm also charges customers an additional Sh4 per minute and a minimum fare of Sh100 for every trip. These will remain the same, according to the firm.

Motorists in Nairobi from mid this month are paying Sh122.81 per litre of super petrol from Sh115.18, representing a Sh7.63 increase, and Sh5.75 more for a litre of diesel at Sh107.66.

"With this sharp increase in the price of fuel, I would like to make an appeal to our customers to accept a small increase in the price that they pay on their Little rides," said Little chief executive Kamal Budhabhatti in a statement.

“If I have to translate this to real-time figures with some examples, a ride from Westlands to Nairobi CBD would go up by only Sh15, Kilimani to Industrial Area would go up by only Sh30 more.

Business Daily could not immediately establish whether Little's rivals Uber and Bolt were considering fare adjustmentsThe costs of energy and transport have a significant weighting in the basket of goods and services that is used to measure inflation in the country.

Producers of services such as electricity and manufactured goods are also expected to factor in the higher cost of petroleum, unleashing pricing pressure across the economy with ramifications on the cost of living measure.

Passenger service vehicle operators had warned of an increase in charges in the wake of rising fuel prices.

Matatu Owners Association (MOA) said earlier in consultation with its members that it is assessing the impact the new pump prices on their business before making a decision, with an increase on fares among its options.

According to MOA, the sharp rise has added to operational costs, at a time when social distancing in pubic transport to contain the spread of coronavirus is still in place leading to reduced earnings.

The Energy and Petroleum Regulatory Authority (EPRA) has linked the expensive fuel to the recovery in crude oil prices, which increased the cost of imported refined fuel, from $55.27 a barrel to $61.61, and low of $17.64 in April last year.

Petrol will for the next month retail at level last seen in November 2011 while diesel is selling at the highest level since December 2018.

The petrol prices, which represent a nine-year high on rising crude costs in the global market, are expected to pile inflationary pressure on the country’s economy.

Editor's Note: This story has been revised to indicate current correct charges for Little.