Uber drivers in Kenya’s capital, Nairobi, have gone on strike to protest a decision by the taxi-hailing tech company to cut prices by more than 35 percent in a bid to stave off growing competition in the East African nation.
A number of drivers affiliated with the San Francisco-based Uber Technologies held a demonstration on Tuesday in Westlands, a suburb of the African city, where the company is headquartered.
Emmanuel Kasina, chairman Kenya Taxi Digital Association, said the price reduction was hurting their business, making it difficult for most Uber drivers to repay their car loans. He called for negotiations over the price cuts.
“Uber made a drastic change to our contract and they did not consult us effectively as partners. Dropping the prices by almost 40 percent,” Kasina said, adding that that the taxi operators were considering joining other rival companies.
Kenya has seen a proliferation of online taxi service apps in recent years including Little Cab, which was launched in July, MaraMoja and Dandia. There are also other international taxi hailing apps operating in East Africa’s largest economy, including Mondo Ride and Taxify.
Uber launched its operation in Kenya in February 2015 and currently has about 1,000 drivers in three urban areas – Nairobi, Mombasa and Thika. It plans to increase the number of drivers in the east African nation signed up to the service to 10,000 in the next three years, according to a Bloomberg report.
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Despite some friction with traditional taxi drivers in the country, the service reached 1 million rides after operating for 15 months.
Uber’s spokesperson said in an earlier statement the company will reconsider the price change if the operators made losses.
“We’re confident drivers will earn the same or more when the cuts help increase their trips — and we have put in place minimum payment guarantees for driver-partners,” the spokesperson said. “And if the amount driver-partners make on the road isn’t what we expect, we’ll reassess this price change.”
The operators said the new prices structure will make it difficult for them to repay loans they took to acquire new cars that they were required to have when they signed up with Uber. They said they will also not be able to maintain their cars.
In May, Uber launched a program in Kenya where drivers would be able to access car loans from a local lender, Sidian Bank, based on their client ratings.
Also read: 12 Taxi Hailing Apps Competing With Uber In Africa