Inside Uber's Strategic Exit from Nigeria, Uganda, and Other African Markets

Uber has officially departed from Nigeria and Uganda, concluding a 12-year run in Nigeria and about a decade in Uganda on September 2. The company stated that the decision followed a thorough review of its business priorities and was limited to those countries, though specific reasons for the Nigeria exit were not detailed by Reuters. These latest withdrawals follow a series of exits across the continent, including Ivory Coast last year and Tanzania in January after nearly a decade of operations.

These closures do not stem from a simple lack of demand. Instead, they highlight a difficult financial calculation involving passenger fare affordability, driver earnings, and platform commission sustainability. Nigeria offers a clear example of these pressures. President Bola Tinubu’s economic reforms, such as removing the fuel subsidy and altering the naira’s exchange-rate regime, drastically increased the cost of doing business. Drivers faced skyrocketing prices for petrol, imported spare parts, and vehicle maintenance, squeezing incomes while fares remained constrained.

Frustration peaked in March when drivers working for Uber, Bolt, and inDrive staged a three-day strike in Lagos and Ogun over unsustainable fares and poor working conditions. Uber driver Farouk Adebayo noted in Lagos that profit margins collapsed following the fuel subsidy removal, making driving no longer worthwhile once maintenance and other expenses were factored in. Ayoade Ibrahim, co-founder and general secretary of the Amalgamated Union of App-Based Transporters of Nigeria (AUATON), explained that drivers faced heavy pressure from 25–30 percent platform commissions combined with rising fuel, maintenance, and insurance costs. Consequently, many drivers migrated to Bolt and inDrive or moved offline to negotiate cash trips.

Competition remains fierce in Nigeria, where Bolt and inDrive operate alongside local platforms like Rida and LagRide. inDrive features a passenger-driver fare negotiation model with a service fee of about 10 percent. Similarly, Uganda presented a challenging environment. The Smart Online Drivers Association previously petitioned parliament in 2019 against platform commissions, citing exploitative practices regarding Uber's 25 percent commission. Competitors such as Bolt, SafeBoda, Faras, Yango, and Tinka have also established a strong presence in Kampala.

Despite these exits, Uber maintains that it remains committed to sub-Saharan Africa, focusing its investments on markets that can provide scalable earning opportunities for drivers and seamless travel for riders. Kenya illustrates a different approach, where government regulations introduced in 2022 capped ride-hailing commissions at 18 percent. Following driver protests, Uber reduced its commission from 25 percent to 18 percent rather than leaving the market, proving that its strategy varies by region based on long-term value and economic viability.