Uber, Yango, Bolt and more…: Disruptions with value addition in urban transport
Amanda Afia Kosi, Accra, Ghana
February March 22, 2024
I n major Ghanaian cities, urban transportation offers choices, affordability, and options. Shared vans or ‟TroTro” (for their slow speed) are the popular forms of inner-city transport system. These shared buses carry up to 30 people. ‟TroTro” buses in Accra provide cheap transport for over 70 percent of its population. The fare for a ride is about half of that of a standard taxi.
The closest competitors to ‟TroTro” are four-seater cars (taxis). They offer personalized and dedicated services. Passengers can hail an empty taxi on the street and arrange a transportation deal on the spot. Local councils allow hundreds of taxi stations near local markets. Shared cars are cheap and flexible means of travel in cities. But pricing is unpredictable and depends on the season, distance, time of the day. The price of fuel price is a fluctuating parameter.
Since 2015, a new type of urban transport services is disrupting the market. These so-called ride-sharing companies use modern communication technology and the internet for booking and personalized services.
First mover’s advantage
Uber launched in Ghana in 2016, followed by Bolt (known then as Taxify). Yango, a popular ride-sharing company from Russia, arrived on the market in Ghana in 2019. Since the launch, Uber has expanded its services to at least five cities in Ghana. Uber is present in Accra, Kumasi, Cape Coast, Takoradi, and Sunyani. Bolt is also present in Accra, Cape Coast, Kumasi, Takoradi, Sunyani, Koforidua, Ho, and Tamale. Yango operates in Accra and has plans to expand in other cities, such as Kumasi and Tamale.
Unofficial market estimates show that Uber and Bolt remain leaders in this market. But at least twelve other homegrown companies are also operating in Ghana.
Ride-sharing companies in Ghana
In Ghana, ride-sharing did not replaced other forms of urban transport. Instead, it brought technological innovation, filled a gap and captured a share of the market. It appeals to younger and technology-savvy generation of consumers1. Before the emergence of Uber and others, personalized urban public transport was a luxury. Ride-sharing companies have rendered this form of transport accessible to ordinary citizens2.
Value addition
Pricing is transparent and predictable in addition to relative security and customized service. Uber and Bolt have added extra services to their core business. Uber launched courier and package deliveries services in 2020 during the COVID-19 pandemic. Then, the company launched ‟UberX Share”. This is a carpool feature where travelers share one car during one trip. The goal is to reduce travel fare. Bolt followed suit with ‟Bolt Foods” through which customers have the ability to request food deliveries to their homes or offices via a separate application.
Critical success factors
The success of ride-sharing companies depends on the quality of infrastructure. Cheaper internet, the availability of electricity and tarred roads, are critical growth factors. The price of petrol and diesel at the pumps is another volatile factor.
Shared-service technology is expanding into other areas of daily life. Accommodation, jobs, education, health, finance, and agriculture will benefit from this technology. But, future success will also depend on regulations. Key regulatory issues are data privacy, digital inclusion and also flexible labor laws.
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BIBLIOGRAPHY
1❩ R.O. Simmons (2018): Disruptive digital technology services: the case of Uber car ridesharing in Ghana, in: Proceedings of the Twenty-Fourth Americas Conference on Information Systems, New Orleans.
2❩ Emmanuel Komla Dzisi, Williams Ackaah, Benjamin Apuseyine Aprimah, Emmanuel Adjei (2020): Understanding demographics of ride-sourcing and the factors that underlie its use among young people, Scientific African Journal, Elsevier. www.elsevier.com/locate/sciaf