Rising car working prices, financing obligations and stress on passenger affordability are making it more and more tough for Nigeria’s ride-hailing operators to hold fares reasonably priced whereas making certain drivers earn sufficient to sustain their work.
Teddy Appa-Dankyi, Senior General Manager for Bolt West Africa, and Mildred Ekanem, Executive Director of LagRide, advised Nairametrics this whereas discussing the sustainability of Nigeria’s ride-hailing financial system following the exits of Uber and Moove.
They defined that the economics of operating mobility companies rely upon how properly operators steadiness the price of preserving autos operational with passenger demand and drivers’ incomes alternatives.
Uber discontinued its Nigerian operations on September 2, 2026, after 12 years out there, while Moove announced on October 8 that it would wind down its Nigerian business, six years after launching in Lagos.
High working prices problem mobility operators
Ekanem advised Nairametrics that operating a technology-enabled mobility business requires greater than constructing an software and connecting passengers with drivers.
- “Running a technology-enabled mobility business in Lagos requires much more than building an application and connecting passengers with drivers,” she mentioned.
- “The real challenge is creating a sustainable transportation ecosystem in an environment characterised by high financing costs, fluctuating energy prices, infrastructure limitations and significant pressure on consumer purchasing power,” she added.
Ekanem mentioned car acquisition and financing stay main price concerns as a result of operators should generate sufficient income to cowl these bills whereas preserving rides reasonably priced.
- “Vehicle acquisition and financing remain among the biggest cost considerations,” she mentioned.
- “The greatest challenge is achieving the right balance between vehicle acquisition costs, financing, daily utilisation and passenger affordability. A sustainable mobility business must optimise all four rather than simply increase fares.”
The underlying problem is that ride-hailing will depend on bodily property that should hold producing income. Vehicles want gas, upkeep and insurance coverage, whereas drivers should earn sufficient to cowl their bills and, the place relevant, meet financing or rental funds.
Rising bills squeeze ride-hailing drivers
Drivers should cowl gas, upkeep, insurance coverage and different car bills from the income they generate. Those who lease or finance their autos additionally face common cost obligations, making their earnings weak when working prices rise or journey demand weakens.
Appa-Dankyi advised Nairametrics that these pressures have an effect on drivers and platforms whereas additionally limiting what passengers can afford to pay.
- “Nigeria’s ride-hailing industry operates within a dynamic economic environment, where fuel prices, vehicle maintenance, insurance, financing costs and general inflation affect both drivers and platforms,” he mentioned.
- “These pressures also influence consumers’ purchasing power and their ability to absorb changes in transport costs,” he added.
Appa-Dankyi mentioned the price of preserving a car operational instantly impacts what drivers retain, though their bills and earnings differ by car, location and dealing hours.
- “For driver-partners, the cost of keeping a vehicle operational is a significant consideration in determining how much they earn from their activity on the platform,” he mentioned.
- “Fuel, servicing, insurance, financing and depreciation all affect what a driver ultimately retains, and these costs can vary considerably depending on the vehicle, location, distance travelled and hours spent on the platform.”
Bolt mentioned its pricing considers market situations whereas balancing reasonably priced fares with alternatives for drivers to earn.
- “Our approach to pricing considers prevailing market conditions and trip dynamics, while balancing rider affordability with the need to support driver-partners’ earning opportunities,” Appa-Dankyi mentioned.
- “Earnings differ from one driver to another depending on factors such as demand, operating hours and individual vehicle expenses.”
Vehicle financing makes utilisation essential
Vehicle financing provides one other layer of danger as a result of drivers who lease or finance their automobiles should meet cost obligations even when the autos aren’t producing income.
For financing corporations, the returns on every car rely upon its availability, utilisation and skill to earn sufficient to cowl working prices.
Ekanem mentioned fleet operators should be sure that every car generates enough income to meet its obligations whereas permitting drivers to earn an affordable earnings.
- “Each vehicle must generate sufficient revenue to support its operating obligations, including financing, maintenance, insurance and other associated expenses, while allowing the Captain to earn a reasonable income,” she mentioned.
She mentioned car downtime can weaken these economics as a result of bills proceed even when a car is unavailable for journeys.
- “Vehicle downtime is one of the biggest risks in fleet-based mobility operations because a vehicle that is not generating revenue may still be accumulating costs,” Ekanem mentioned.
- “Financing obligations, insurance, depreciation and other fixed expenses do not automatically disappear because a vehicle is temporarily unavailable.”
Ekanem mentioned decrease utilisation can put stress on drivers and fleet operators, making preventive upkeep and efficient car administration important.
- “Lower utilisation can reduce the income available to meet operating obligations and place pressure on both the Captain and the wider fleet economics,” she mentioned. “The response must therefore be operational as well as financial.”
Ekanem mentioned LagRide’s method is to handle autos as productive property all through their operational lives somewhat than treating them merely as automobiles out there for bookings.
- “We believe that preventing avoidable problems is significantly more effective than constantly responding to emergencies,” Ekanem mentioned.
- “Our approach is to manage the vehicle as a productive economic asset throughout its operational life, not simply as a car available for bookings on an application.”
Different fleet fashions carry totally different dangers
Ride-hailing corporations additionally face totally different dangers relying on how they receive autos. Asset-light platforms rely largely on drivers or third-party fleet house owners to finance and preserve autos, whereas structured fleet fashions tackle extra duty for car entry, utilisation and operational oversight.
Ekanem mentioned every method has totally different calls for, and its sustainability will depend on how properly it matches Nigeria’s market situations.
- “An asset-light ride-hailing platform can expand relatively quickly because individual drivers or third-party fleet owners bear much of the responsibility for vehicle acquisition and maintenance,” she mentioned.
- “A more structured fleet ecosystem requires greater coordination, stronger operational oversight and disciplined management of vehicle financing and utilisation,” she added.
She mentioned an organization’s nationality alone doesn’t decide whether or not its mannequin can achieve Nigeria.
- “The question is not whether a mobility company is local or international,” Ekanem mentioned. “It is whether its operating model genuinely addresses the economic realities of the market in which it operates.”
The distinction issues as a result of an asset-light mannequin can restrict a platform’s direct publicity to car financing, but it surely doesn’t take away the monetary pressures dealing with drivers and fleet house owners.
A structured mannequin can supply extra oversight and assist, but it surely should handle the fee and productiveness of the autos below its management.
Fuel prices and platform commissions squeeze driver earnings
Rising gas costs and platform deductions are placing stress on ride-hailing drivers’ earnings, whereas operators should hold fares reasonably priced for passengers.
Nairametrics beforehand reported that petrol prices in Lagos rose from about N800 per litre at the end of February 2026 to between N1,300 and N1,330 by mid-April, a rise of greater than 60%.
For platforms, growing fares to offset larger prices dangers making rides much less reasonably priced. Bolt mentioned its pricing choices should account for this pressure between passenger demand and driver earnings.
- “Riders remain sensitive to fares, making it important to balance affordability with the need to support sustainable driver earnings,” Appa-Dankyi advised Nairametrics.
The stress is not restricted to gas. Drivers even have to account for servicing, repairs, insurance coverage and depreciation, whereas these working financed or rented autos should meet their cost obligations no matter how a lot they earn on a selected day.
Platform commissions have turn into one other level of disagreement between drivers and ride-hailing corporations. Drivers argue that deductions cut back their earnings, whereas platforms should fund the expertise, buyer assist and security techniques wanted to function.
Nairametrics’ earlier reporting, based mostly on driver accounts, put deductions at round 25% for Uber and Bolt and 12% to 15% for inDrive. Bolt has acknowledged that its fee is 20% in Lagos and 21% in Abuja, disputing claims that it expenses 30%.
These figures aren’t instantly comparable as a result of complete deductions could embrace taxes and different expenses.
AUATON has known as for a ten% fee cap and fare evaluations. Its four-day shutdown ended on October 16, with the union directing drivers to resume regular operations.
The disagreement displays the competing pursuits throughout the business. Drivers need sufficient earnings left after deductions and bills, whereas platforms should preserve a service that draws passengers and covers their very own working prices.
Why Uber’s exit mattered for Moove
An evaluation by ride-hailing knowledge aggregator Obi examined 20,298 Uber and inDrive rides involving 308 drivers between January and July 2026.
- It discovered that Uber paid drivers greater than passengers had been charged on some shorter journeys, with the hole reaching 23% for journeys overlaying 5km to 9km. Uber drivers within the Nigerian pattern averaged 130 rides over seven months, in contrast with 1,142 for Uber drivers in South Africa.
- Moove mentioned Uber’s departure materially modified the working setting for its Nigerian business. The vehicle-financing firm introduced its Nigerian wind-down on October 8, saying that, after assessing its choices, it couldn’t sustain its working mannequin.
- Moove mentioned greater than 9,000 Nigerian clients had used its merchandise and that autos financed by its business generated N57 billion in income. Under its wind-down preparations, eligible clients had been to obtain autos price about N35 billion with out additional funds for these autos.
The developments spotlight the pressures dealing with related elements of the mobility financial system: ride-hailing platforms want sustainable journey economics, whereas vehicle-financing companies rely upon drivers producing sufficient earnings to meet working prices and compensation obligations.
The exits expose dangers, not a failed market
Uber’s departure and Moove’s wind-down expose dangers throughout related elements of Nigeria’s ride-hailing financial system, however they don’t set up that your complete sector is unviable.
Bolt reported a 92% week-on-week improve in driver registrations after Uber’s exit. The firm mentioned the rise mirrored curiosity in its platform, however registrations alone don’t set up what number of drivers turned lively, what number of journeys they accomplished or whether or not their earnings had been sustainable.
Ekanem mentioned LagRide had noticed elevated curiosity from drivers and passengers however cautioned in opposition to attributing all of it to competing corporations’ exits. She mentioned the corporate monitored driver enquiries, onboarding, passenger bookings and fleet deployment, however didn’t present figures to quantify the modifications.
She mentioned a sustainable mobility ecosystem should additionally present respectable incomes alternatives, preserve autos correctly and earn passengers’ belief.
- “A mobility ecosystem cannot be sustainable if its drivers cannot earn a decent living, its vehicles are not properly maintained or its passengers cannot trust the service,” she mentioned.
The proof means that Uber’s exit created alternatives for remaining operators to appeal to drivers and passengers.
But capturing that demand is not the identical as proving {that a} business mannequin can generate sustainable returns over time.
