Uber Battles Competition With Fare Slash
Taxi hailing giant, Uber is looking to overrun competition by slashing its taxi fares by 40%.
The fare reduction which starts on Thursday, is only for Lagos.
This is in clear response to the latest price rate reduction by its competition, Taxify, an Estonian international transportation network company, which made aggressive entry into the Nigeria hailing market in late 2016.
By this reduction, Uber users can now travel far within Lagos for less, For instance, a trip from Magodo to Gbagada which used to cost 1,100 Naira will now cost from 600 to 1,000 Naira
Also, a trip from Yaba to Ilupeju which used to be from 1,300 Naira will now be from N800
Uber, said in a statement that it wants to make sure that Uber is an affordable way to move around your city, “so we’re dropping rates in Lagos by 40% from Thursday 4th May 2017.”
Will this work for Uber? Only time will tell. Uber had everything working for it while it was a monopoly until Taxify waded-in, in November 2016.
Taxify did not only go against the grain by imposing less restrictions on driver and car acquisition requirements but also started with charging a far less driver commissions compared to Uber.
It was not long; Uber drivers were flowing away to Taxify. Dismissed Uber drivers did not also help matters as they also lured more people away from Uber to Taxify.
Industry watchers and analysts alike had expected this reaction from Uber long ago but perhaps, it may not be late yet to yield the desired impact.
Although this move makes a lot for sense to beat competition, a more pragmatic approach would be to also reduce the commission it charges drivers.