Popular taxi-hailing company Uber is set to hike its fares in the next two weeks as a result of the rising fuel costs.
Earlier this week, the Energy and Petroleum Regulatory Authority (EPRA) announced new fuel prices that increased products by at least Ksh 9 per litre. Petrol hit a new record high of Ksh.159.12 per litre while diesel and kerosene are now selling at Ksh.140 per litre and Ksh.127.94 per litre respectively.
Uber East African director Imran Manji said that new adjustments are meant to create a balance that keeps the drivers in business.
“We are looking at the pricing, and there is more chance than not that we will be reviewing our rates upwards to factor that fuel price increase,” Manji said, adding that the company is working to create a “sweet spot between not destroying demand by pricing and ensuring that drivers cover their costs.”
The rising cost of petroleum products has had a ripple effect that has led to a sharp rise in the cost of living. The situation has been exacerbated by the fact that companies are still reeling from the prolonged effects of the Covid-19 pandemic.
Mr. Manji said the situation is leading organizations to rethink their approach to business.
“It’s a difficult situation in the market right now because as the cost of living for everybody goes up, the affordability of things like ride-hailing comes into question. If we raise our prices too high; when the majority of people are already feeling price pressure on daily necessities, we are limiting how many people are going to be using our services and also limiting the driver of earnings.” He said.
Uber was forced to make a similar review in February after another fuel hike was effected by EPRA. The constant jump in fuel prices is causing uncertainties for firms such as Uber whose business is directly affected by fluctuations.