Stiff Competition, Low Fares, High Commissions Force Uber Out of Nigeria, Uganda—After Ivory Coast, Tanzania

By Samuel Aghulor
Stiff competition from rival ride-hailing platforms, persistent driver complaints over low fares and high commission charges, and escalating operating costs across the continent have forced global ride-hailing giant Uber to shut down its operations in Nigeria and Uganda, extending its retreat from African markets after earlier exits from Ivory Coast and Tanzania.

Uber announced the immediate closure of its businesses in Africa’s most populous country and the East African nation, saying it reached the “difficult decision” after a comprehensive review of its operations.

The withdrawal ends a 12-year presence in Nigeria, where Uber launched in 2014, and a decade of operations in Uganda, which it entered in 2016.

In Nigeria, Uber had increasingly faced intense competition from rival international platforms such as Bolt and InDrive, as well as a growing number of indigenous ride-hailing operators battling for both passengers and drivers.

At the same time, Uber drivers had repeatedly complained that fares offered on the platform were too low to sustain their businesses in the face of rising fuel prices, vehicle maintenance costs and other operating expenses.

Drivers also protested against what they described as high commissions deducted by the company from their earnings, arguing that the combination of low fares, high commissions and rapidly rising costs had steadily eroded their incomes.

The tensions have triggered protests and industrial action among ride-hailing drivers in recent years, with operators demanding higher fares, lower commissions and improved working conditions.

The economics of the business became even more challenging following the removal of Nigeria’s petrol subsidy in 2023, which sharply increased fuel and transportation costs. Motorists have faced further pressure this year following another rise in petrol prices amid global energy-market disruptions arising from the US war with Iran.

Uber’s exit from Nigeria and Uganda also forms part of a broader contraction of its footprint in Africa.

Over the past year, the company has withdrawn from Ivory Coast and Tanzania. The latest closures mean Uber’s African operations are now concentrated in Egypt, Ghana, Kenya, and South Africa.

The decision comes as Uber Chief Executive Officer Dara Khosrowshahi announced plans to cut the company’s global workforce by 10 per cent.

Despite the string of withdrawals, Uber insisted that it was not abandoning Africa.

“This decision is limited strictly to these two markets and does not impact our operations across the rest of the continent,” the company said in a statement to the BBC.

“We remain committed to sub-Saharan Africa, where we continue to see strong growth and opportunity.”

During its 12 years in Nigeria, Uber expanded beyond its conventional app-based taxi business as it sought to establish itself in the country’s huge transportation market.

In Lagos, Nigeria’s commercial capital, the company launched a boat service in 2019 to offer commuters an alternative means of navigating one of Africa’s largest and most congested cities.

But competition in the Nigerian ride-hailing industry has intensified considerably over the past decade, with Bolt and inDrive among the major international competitors challenging Uber, alongside several local platforms.

Uber’s departure is also expected to alter the competitive landscape in Uganda, particularly in Kampala, where rival services including Faras, Bolt, and SafeBoda are expected to compete for passengers and drivers previously using the platform.

The company said it would support employees and drivers affected by the shutdown and keep its help centre open in Nigeria and Uganda until September 23 to resolve outstanding issues arising from its departure.