Source: tybrandafricamagazine.com
Without advance warning on Wednesday, September 2nd UBER abruptly ceased operations which literally shocked both drivers and consumers alike. Some drivers and customers were actually caught mid-trip in this spiraling news. The sudden ending of this transportation chapter has impacted these countries on many levels.
Several years ago, ride-hailing was not commonplace across many African countries. Mobility was largely restricted to conventional transportation, with commuters walking to bus parks or roadside locations to board vehicles. But with the advancement of technology and the introduction of companies like Uber, Bolt, formerly Taxify, and inDrive, ride-hailing has become a critical contributor to the African economy. Mordor Intelligence predicts that the African ride-hailing market is expected to grow from USD 2.53 billion in 2025 to USD to USD 3.25 billion by 2031.
For more than a decade Uber represented one of the most visible faces of Africa’s emerging ride-hailing gig economy. Nigeria and Uganda transformed the way millions of people moved around cities while creating a new source of income for drivers who wanted greater flexibility in how they worked.
Although the company did not provide specific reasons for the pullout beyond describing the decision as the result of a review of its business operations and investment priorities, speculation, especially in Nigeria, has linked the decision to rising fuel costs and complaints from Uber drivers about high commission charges. In 2023 elected President Bola Ahmed Tinubu, General Commander of the Federal Republic announced the ending of the Fuel Subsidy in Nigeria which led to increases in retail petrol prices. This impacted operating costs and vehicle expenses that transferred to the challenges of maintaining low driver expenses and affordable rates for commuters while enduring higher commission rates.
In the space of two years, Uber has officially exited Côte d’Ivoire, Tanzania, Nigeria and Uganda while continuing to operate in markets including Ghana, Egypt, Kenya and South Africa. For Uber, the decision is part of a larger global restructuring. For African drivers, however, it is much more personal.
Behind every ride booked through an app was a driver trying to pay rent, support a family, finance a vehicle, pay school fees or simply create an income stream in economies where formal employment opportunities remain limited or simply do not exist. Uber’s departure therefore raises a bigger question than what happens to one ride-hailing company. What happens to the Black workers who built their livelihoods around the gig economy?
Uber’s exit does not mean that ride-hailing is disappearing from Nigeria or Uganda. Both markets have local and regional competitors, and drivers can potentially move between platforms. But it does expose the fragility of an economic model in which workers depend on global technology companies that can change their priorities almost overnight.
Nigeria became one of Uber’s most important African markets after the company launched in Lagos in 2014 and subsequently expanded to other cities. The platform entered a market where smartphones, digital payments and urban transportation needs were growing rapidly. It offered drivers an alternative to traditional employment and gave vehicle owners an opportunity to turn their cars into income-generating assets.
Uganda experienced a similar transformation. In Kampala, ride-hailing became part of the everyday transportation landscape, connecting passengers with drivers through a smartphone rather than the traditional roadside search for a taxi.
For many Black drivers, the attraction was not necessarily the promise of getting rich. It was access to a form of livelihood that helped them make ends meet.
A person with a car could potentially become a driver. Someone who needed additional income could drive during selected hours. A vehicle that might otherwise sit idle could become a business. The smartphone became the office, the car became the workplace, and the road became the marketplace.
That flexibility was one of the gig economy’s greatest selling points. But flexibility also comes with its challenges.
Unlike traditional employment, gig workers generally carry many of the costs associated with doing the job. Fuel, vehicle maintenance, insurance, depreciation, mobile data and other expenses can eat into earnings. In Nigeria, these pressures have become particularly severe as inflation, rising fuel costs and currency volatility have increased operating expenses.
The situation illustrates an uncomfortable reality about Africa’s economy. While technology can create opportunities, it does not necessarily guarantee stable jobs, especially when policies are not structured to create the enabling environment needed for these jobs to thrive.
Uber’s platform connected drivers to customers, processed payments and provided a recognizable global brand. But the driver remained responsible for the vehicle, fuel and many of the everyday costs required to keep the business running.
When the platform disappears, those costs do not disappear with it. Instead, drivers are faced with the uncomfortable reality of losing an additional income stream.
Uber’s withdrawal from Nigeria and Uganda happened at the same time the company announced a global workforce reduction of about 10%, translating to roughly 3,300 employees. The company intends to do this while increasing its focus on future technologies, including autonomous transportation.
While African drivers are still relying on human beings behind the wheel to earn an income, the company is directing greater attention and capital toward a future in which technology could reduce the need for human drivers in some markets.
While it is within Uber’s rights to explore this option, the bigger concern is that African economies must begin to explore homegrown opportunities.
Read also: The Gig Economy in Africa: Opportunities for Freelancers
Source: tnx.africa/newsbeat
African cities have become important markets for digital platforms because they offer large populations, rapidly growing smartphone adoption and huge transportation needs. But African workers should not merely become consumers and service providers in somebody else’s technological ecosystem. They should also have opportunities to own, build and scale the platforms themselves.
The next phase of Africa’s gig economy could therefore be less about global brands entering African markets and more about African companies developing solutions designed around African realities.
Nigeria and Uganda are not short of entrepreneurial talent. Local ride-hailing companies have already demonstrated that African businesses can compete in the mobility sector. The challenge is creating platforms that can remain financially sustainable while offering drivers reasonable earning opportunities.
Drivers need competitive fares, but passengers also need affordable transportation. Platforms need revenue to operate, but excessive commissions can squeeze drivers. Governments need taxes and regulation, but excessive costs can make the business model unsustainable.
The future of the African gig economy will depend on finding a sustainable middle ground between policy formulation and its practical application within the African economy, particularly as the issues that likely contributed to Uber’s exit remain challenges faced by other ride-hailing companies.
As pointed out by Ashif Black, country representative for inDrive in South Africa, during an interview with Business Insider Africa, “Uber’s exits highlight the difficulty of building a sustainable mobility business across markets where inflation, currency volatility, fuel prices, vehicle financing and maintenance costs can quickly change the economics of a ride.”
Yet, Uber’s exit also offers an opportunity for the workers themselves. Gig work should not necessarily be viewed as a permanent destination. For some drivers, it can provide an entry point into entrepreneurship, transportation management, logistics or other businesses. The skills acquired through driving, customer service, digital payments and managing daily operating costs can potentially become the foundation for larger ventures.
The bigger opportunity is to turn gig workers from users of platforms into owners of businesses. A driver who understands the transportation market has firsthand knowledge that many technology companies spend millions trying to acquire. Drivers understand traffic patterns, passenger behavior, pricing realities and the practical challenges of moving people around African cities.
That knowledge has economic value.
Uber’s departure should therefore not be interpreted simply as the failure of the African gig economy. It is better understood as a test of its maturity. The first generation of Africa’s gig economy was largely about access. Global platforms arrived, connected workers to customers and demonstrated that smartphones could create new income opportunities. The next generation must be about ownership, resilience and worker protection.
Nigeria and Uganda have shown that Africans are willing to embrace digital work when it solves real problems. The question now is whether governments, entrepreneurs and investors can build an ecosystem where those opportunities remain available even when one multinational company decides to leave.
Uber may have left the streets of Lagos, Abuja, Kampala and other cities, but the demand for mobility has not disappeared. Neither has the need for income.
And that may ultimately be the most important lesson from Uber’s African exit. The continent’s future gig economy cannot depend entirely on companies that can enter and leave its markets according to global investment priorities. Africa needs digital platforms that understand its workers, its cities and its economic realities and, most importantly, give African workers a greater stake in the value they create.
Okechukwu Nzeribe works with the Onitsha Chamber of Commerce, in Anambra State, Nigeria, and loves unveiling the richness of African cultures. okechukwu.onicima@gmail.com
