Companies

Pewin Cabs’ fixed fares turn the heat on online taxi rivals

JK

Mr Justus Kirigua, the Pewin Cabs chief executive. PHOTO | SALATON NJAU

Taxi services company Pewin Cabs’ decision to set fixed zonal charges has shifted the price war in the industry where rival firms have faced criticism for surging fares depending on the duration taken on a trip.

Pewin Cabs’ Dandia e-hailing application, launched on Friday, has set specific charges between destinations, unlike rivals Uber, Mondo Ride and Taxify that only indicate a price estimate at the beginning of a trip.

Dandia, for instance, will charge a flat fee of Sh300 from the CBD to Sarit Centre and Sh1,500 from the city centre to Karen. This means customers can know the final cost of the journey by keying in the pick-up and destination points.

“We will operate a little differently from the usual apps in the market because we want to make the transport service available to every person. The zonal pricing model by Dandia app ensures predictability in that people do not go outside their budgets while accessing our services,” said Justus Kirigua, the chief executive of Pewin Cabs.

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Uber customers, for instance, are charged based on the kilometres covered, the time spent and the availability of a taxi — with riders being subjected to price surges during peak hours — sometimes doubling the original fare estimates.

“We do not offer any predetermined fees in Nairobi, but have technical capability to do so. Our app clients can estimate the price of the trip after they have confirmed their pick-up location. This isn’t a guarantee but an indication of the trip price. The actual trip might be cheaper or more expensive depending on the traffic and which route is taken,” said Pavel Karagjaur, Head of Marketing at Taxify, which is available in major cities in the world including in South Africa, Estonia, Czech, Finland, Georgia, Latvia, Lithuania, Serbia, the Netherlands and Mexico.

Mondo Ride Head of Africa, Troels Andersen, said the pre-determined fares model may be unsustainable for a taxi-hailing business.

“The principal economics of the business are based on the distance travelled and the time taken to travel. The mileage of the vehicle will eventually determine how profitable the drivers can be,” he said.