US-based Uber plans to expand in Tanzania, Uganda and Ghana this year and will focus on convincing traditional taxi drivers to work for the ride-hailing service, Alon Lits, Uber’s general manager for sub-Saharan Africa, said.
Traffic-clogged roads, high rates of urban crime and a lack of credit card are big challenges Uber faces in sub-Saharan Africa, where it operates in seven cities in South Africa, Nigeria and Kenya. But its biggest problem is the one it faces from Rome to Rio; the friction with traditional taxi drivers who see Uber as a threat to their livelihoods.
“Part of our strategy when we launch in new markets will be that engagement up front with taxi operators,” Lits told Reuters in an interview in Nairobi. “We will be doing a better job of engaging.”
That strategy will involve convincing traditional taxi drivers to work for Uber, showing them they can continue working on their own, but when they don’t have a fare they can also choose to use the Uber smart-phone app to pick up passengers and make extra money.
Lits said Uber, which operates in more than 400 cities worldwide, will set up East and West Africa “hubs” in Nairobi and Lagos to act as launch-pads for forays into Tanzania, Uganda and Ghana, and would begin operating in a second city each in Nigeria and Kenya. “We feel we are at a point now where we have a strong sense for what it takes to build a successful Uber business in Africa,” Lits said.
In Kenya and Nigeria, the company is looking to make it cheaper for Uber drivers to rent vehicles. In South Africa, the company has teamed up with a financing company to help drivers obtain car loans based on their work history with Uber, including the customer ratings they received on the app.