Uber made a market entry into Ghana last year and already local taxi drivers are crying–claiming Uber is killing their business.
Of course, Uber is doing something right in Ghana by being able to “steal” the customers of these local taxi drivers–and a key point is the huge disparity between Uber fares and how much the local taxi drivers charge for the same distance, despite Uber rides being more comfortable.
Uber attempted to gain market dominance in China but because China had a local taxi system that worked better than Uber in terms of service and price, Uber was forced to run out of China, selling its market share to Didi Chuxing.
In Ghana, Uber seems to be solving the problems of local customers–when it comes to reliability, affordable price and comfort. And instead of the local taxi drivers stepping up to become a viable competition, they’ve started crying…
“Taxi drivers, especially from the Committed Drivers Association have initiated a series of media campaigns to tout their plight for government’s attention” in relation to Uber killing their business, reports Graphic Online.
According to Mr Francis Appiah, the spokesperson of the Committed Drivers Association, “the drop in patronage of taxi cabs, identified with yellow paint on their fenders was due to the emergence of the services of Uber.”
“Mr Appiah told Accra Radio that insurance premiums paid by Uber service providers were much lower than that of taxi drivers because of the use of private cars for Uber services. This, he said, allowed Uber to charge relatively lower fares, thereby having an edge over conventional taxis,” the website added.
He said: “The Uber service is killing the work of taxi drivers in Ghana. Because they know as foreigners they would not be able to engage in this kind of work in Ghana, some Ghanaians fronted for them to enable them gain access to the local market.”
“They don’t pay income tax, they don’t pay for embossments, but we the taxi drivers do pay. Taxi drivers also possess AMA embossment licences and stickers, but they [Uber taxis] don’t have them. Again, because they mostly use private cars to do their business, the insurance they pay is much lower than what the commercial drivers pay.”
“Even the use of private cars is against the road traffic regulations, but everybody is watching as they violate the law. Today as we speak, when you go to Tanzania, Uber has killed taxi drivers’ businesses and even in the United States where they come from, they are gradually killing the taxi business.”
“China saw the dangers they posed to their local drivers and so they prevented them from entering their market. And so why should we allow them to also kill our businesses here in Ghana?”
That’s not really what happened in China–Uber entered the market but could not beat the local competition.