“It is perfect”- Meet the Lagos e-hailing driver using a N10m electric car for Uber and Bolt

The Nigerian e-hailing market is experiencing torrid times occasioned by petrol subsidy removal. The removal has more than tripled the price of petrol which is a major requirement for e-hailing businesses.

With the app companies refusing to adjust fare prices, many Bolt and Uber drivers are already quitting the hustle as it is no longer profitable. But maybe using an electric car could salvage the situation?

But one Lagos driver, Abel, isn’t bothered much about these. This is because Abel uses an electric car for his taxi business. As such he isn’t bothered about the rising fuel prices, neither is he perturbed by the app companies’ refusal to institute a commensurate hike in fares for passengers on their platforms.

Speaking with Technext, Abel who has been an e-hailing driver for six years, said he only switched to an electric car 7 months ago. Compared with the five years prior to his switching, he said he hasn’t regretted the move at all.

“I have switched to an electric car for close to 6 months now. My boss pitched the idea to me and I would say it has been worth it. I don’t buy fuel anymore. My profit margin is very good because it boils down to how I work because I don’t stress myself like I used to when I was using a combustion engine vehicle,” Abel told me.

The many challenges with vehicle financing that electric cars could solve 

Abel’s vehicle is a Changan Eado which costs around N10 million. This is generally considered a lot of money to sink into the ride-hailing business. Most e-hailing drivers use second-hand vehicles which on average cost between N2 million to N3.5 million.

The only e-hailing drivers using vehicles that cost as much as N10 million (and even more) are the drivers under the vehicle financing schemes of companies like Moove and Lagos Ride. And these arrangements have been wrought with their own challenges with drivers operating on those platforms mostly unable to meet up with the usually improbable demands.

Indeed, a Technext investigation into the activities of these companies reveals that Moove vehicles are locked into only the Uber app. Max vehicles can only work on the Bolt app and Lag Ride vehicles only work on the Lag Ride app. This severely limits the freedom and how much money a driver could make, especially for those on less popular apps like Uber and Lag Ride.

“It can be very frustrating,” Grace, a female driver on Moove’s rental service says. “Uber is not as common as Bolt so if you drop a passenger here, the next request you may get can be 20 or 30 minutes away. And you can’t reject rides on the rental because one of your targets is that you must complete at least 35 rides in a week.

So you must go there. The 20-30 minutes is an unpaid service you do with your own fuel. And it’s not as if you get rides every time. At the end of the week, after Moove and Uber have deducted their money, I’m left with very little to go home with. It’s not worth it abeg. If I can find someone to lease me their vehicle, I’ll quickly dump this one.”

To indicate, financing companies deduct their service charges and commissions for their respective ride-hailing apps (Uber for Moove drivers). Putting this into perspective, Moove drivers on the UberGo platform told me that the average daily revenue they make is N18,000. Out of that, they are required to pay N9,400 to the financing company which amounts to about 65,000 per week.

For emphasis, the regular Uber and Bolt driver who has an arrangement with private car owners remits an average of N25,000-N30,000 per week.

The drivers are further required to remit N4500 (25 per cent) to Uber making a total of about N14,000. This is roughly 78% of their total average earnings per week. This leaves them with just N4000 (22%) for other expenses like fueling their vehicles, data and take home.

They said even when a driver is sick and bedridden, they are still required to make the N14,000 daily remittances. According to them, even in such instances, defaulting drivers would be disabled, their cars repossessed, and all the money they have been depositing to date will be forfeited.

It wasn’t surprising then that the drivers embarked on strike action back in February to protest the unbearable working conditions. The drivers also accused the company of charging them a weekly maintenance fee, handling costs and health insurance even though it never gave them access to an HMO service.

“We are required to be online for 12 hours. In those 12 hours, you could make N18,000. Out of that N18,000 you will have to pay 9,400 to Moove and N5,000 to Uber. If you fuel your car for N4000 and buy a calling card, how much is left? Some of us even have to borrow money from loan apps just to settle our remittances. It is slavery,”

– a leader of the protesting group told me at the time.

Abel believes the demands/returns would have been easier to meet if the drivers did not have to spend so much on fuel, which is usually the biggest operational expense incurred. They could also have saved up on maintenance costs and having to replace some parts because electric vehicles, by their nature, are low-maintenance vehicles.

“Electric cars are just perfect, and judging from expenses from regular servicing that you do not have to bother about because the car literally has no engine, coupled with the state of economy and price of PMS, it is the main deal,”

Using electric cars for the e-hailing business is the way to go

Lagos is the biggest e-hailing market city in Africa with approximately 25,000 drivers and a population of roughly 15 million. This invariably makes it a big market for every kind of business, including the relatively nascent e-hailing business.

At the same time, the recent fuel subsidy removal had a negative impact on the transport industry, especially the ride-hailing sector.

Not just because their business is heavily fuel-dependent, but also because economic activities in Nigeria are heavily fuel-dependent. The policy has led to a sharp rise in goods and commodities and a consequent rise in inflation. All of these have combined to reduce the purchasing power of the people and plunge Nigerians into a state of lack and general hardship.

It has also thrown e-hailing drivers in disillusionment as they now scramble for scarce rides on the e-hailing platforms in a bid to meet up with the skyrocketing cost of living. But unlike other drivers, Abel says he doesn’t scramble for rides like they do because he can afford to work at his own pace.

“I am not really someone that rushes to work, I take my time so I will just say it is perfect. I don’t do trips like the other drivers so I can’t even say the exact amount of trips a full battery lasts but I usually use a full charge for a full day. When the battery is completely depleted, it takes 8 hours for a full charge.”

Abel says the only downside is that it takes time to fully charge. But if one could plan their time and charge the vehicles when they are resting, then electric cars for the e-hailing business are the way to go.