Uber’s bet on ‘Okada’

by | Jan 25, 2022

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Hello,

Let’s talk about this not-so-new kid on the block.

Uber’s gamble on Nigerian motorbikes 

The gist: On Monday, Uber launched UberMoto, its motorbike on-demand service in Ibadan, Nigeria, to join competitors like SafeBoda, MAX.ng, and Gokada.

The global mobility company has been operating in Nigeria for eight years. Besides heralding the beginning of app-based on-demand car-hailing in the country, it has witnessed the entrance of popular competitors like Estonia mobility startup, Bolt(formerly Taxify) and inDriver, including other local entrants; it also saw how Chinese-owned OPay gave the model a try with OCar, although it didn’t scale.

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Within the same time, Uber has expanded into five states in the country. The latest is Ibadan and Portharcourt in October 2021. However, despite its slow but calculated expansion rate, it took Uber this long to bring any other vertical asides car-hailing into the country.

Makes me wonder why. A possible reason is if the company planned to do something totally different? Come to think of it; the best time would have been when Lagos was still a hotspot for on-demand motorcycle services. But that would also mean partaking in the loss suffered following the Okada ban in February 2021.

Four weeks ago, it was in the news that Uber partnered with Opibus to deploy 3000 electric motorcycles across the continent. Could this be the plan for Ibadan? 

From Uber’s country manager, Tope Akinwumi’s comment about the launch, the plan is to provide a cost-effective and quicker transportation option. But there was no mention of electric vehicles.

Although UberMoto’s model was not clearly stated, it is most likely going to run like Uber car service, where it taps into the current network of riders, screens and does background checks on interested riders before onboarding them.

My concerns: If the late-mover disadvantage exists, Uber might have to resort to giving heavy discounts to attract and retain customers, which might be unsustainable in the long run. While UberMoto would rest on Uber’s image, which by the way, is pretty new to Ibadan, we can’t say it will be Uber’s top priority to make it work.

Fun fact: Thailand was UberMoto’s first market in 2014. Sadly, this service was halted two years later due to government regulations. In 2018, it was Uganda’s turn to have UberBoda, the first in Africa. 

It’s clearly too early to guess UberMoto’s fate; after all, Ugandan SafeBoda seems to be having a relatively good run in the market. Only time will tell if this was a smart decision. What do you think?

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What else I’m reading

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Have a productive week ahead!

Oluwanifemi Kolawole
Oluwanifemi Kolawole

Human enthusiast | Writer | Senior reporter | Podcaster.


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