Why Uber is in retreat in Africa

Uber’s “journey in Nigeria has been one of growth, empowerment and transformation,” Tope Akinwumi, the company’s then country manager, wrote last year in the forward to a report that hailed its impact in Nigeria. The Silicon Valley company claimed to have contributed 34bn naira ($26m) to the local economy in 2023, saying that it had helped riders save 1.8m hours compared to their other commuting options. “Looking ahead,” Akinwumi wrote, “Uber is dedicated to furthering its contribution to Nigeria’s growth, development and innovation.” The company was the pioneer of online ride-hailing in Nigeria. It entered the country in 2014 and expanded into 12 cities. Not so long ago, it enjoyed a dominant position in the market and seemed set to be a key player in the future of urban mobility in Nigeria. But Uber’s final destination in Nigeria has proven to be the exit door. “After a thorough review of our business, we have made the tough decision to wind down our operations in Nigeria,” it said in a statement to customers on 2 September. And it is not just Nigeria where Uber is in retreat. At the same time it also announced its withdrawal from Uganda after a decade in the country. It quit Tanzania in January and left Côte d’Ivoire in September 2025. The company states: “We remain committed to sub-Saharan Africa, where we continue to see strong growth and opportunity.” The reality, however, is that it is now present in only four African countries: Egypt, Ghana, Kenya and South Africa. Why is the world’s largest ride-hailing company by revenue struggling to survive in the rapidly urbanising countries of Africa? Breakdown The basic problem for Uber is one of maths. To be profitable, it needs to offer fares that are low enough to be affordable to low-income customers, but high enough to allow drivers to make a living and leave a margin for the company. Walking this tightrope has never been easy – and has been made much harder due to rising fuel prices. In Nigeria, the impact of higher wholesale prices has been greatly increased by the removal of fuel subsidies in 2023, which led to petrol and diesel costs rising threefold almost overnight. Fuel costs have been pushed even higher this year because of disruption to global oil supplies following the US-Israeli attack on Iran, leading to higher fares for passengers. Ikemesit Effiong, partner at consulting firm SBM Intelligence, says many Nigerians have “bled out” of middle income status as a result of the economic situation over the past decade, thereby shrinking the size of Uber’s addressable market in the country. “Those who are seeking to maintain their status in middle-income territory had to adjust consumer behaviour,” he says. “A lot of potential household spend that is seen as discretionary has either been significantly curtailed and constrained, or it’s been totally cut.” He adds that the depreciation of the naira – which has lost around two-thirds of its value against the dollar since 2023 – caused further problems for Uber, given that many of its costs are in dollars. “The maths stopped working.” A congested market Uber, founded in 2009 and heavily backed by venture capital, expanded aggressively around the world in its early years. As it entered new cities, the company’s formula of offering cheap fares and convenient hailing quickly became massively popular. Inevitably, its success in disrupting the traditional model of taxi businesses invited imitation. Uber’s insistence on taking a large commission from its drivers – generally 25% of the fare paid by riders – left the company vulnerable to being undercut by competitors with business models that are similar but allow drivers to keep a larger cut of fares. Estonia-headquartered Bolt, Uber’s main rival in Nigeria, typically charges commission of around 15-20%. Self-employed drivers, who typically service multiple platforms, therefore had an incentive to shift away from Uber. The announcement that Uber was leaving Nigeria with immediate effect may have been sudden, but it would not have come as a shock to many former drivers and riders. Although Uber has never published ridership figures, it is now clear that the high-water mark of its business in Nigeria had long since passed. Over the past few years, it has suffered a severe loss of market share to the likes of Bolt and Russian-founded inDrive, along with numerous local companies including LagRide and bus sharing platform Shuttlers. Market insights company Sensor Tower reports that Uber had 500,000 active users in Nigeria in December 2025, compared to 3.3m for Bolt. Adapting to survive Uber’s competitors are not, of course, immune to rising fuel costs and must walk the same tightrope on which Uber was unable to keep its balance in Nigeria. But Bolt, which now operates in nine African countries, has taken a noticeably more flexible approach to the realities of Nigeria. “Bolt was able to make compromises in Nigeria that Uber just wasn’t willing to do,” says Effiong. He highlights how Uber insisted on stringent standards on the vehicles that could be operated through its platform, while also encouraging drivers to take out comprehensive insurance. Bolt, by contrast, allows drivers to operate in older vehicles and even motorised three-wheelers known as kekes in parts of Nigeria. While Effiong notes that these compromises have “come at a cost” to Bolt’s reputation, the company’s willingness to adapt to local market realities has allowed it to appeal to a broader market than the shrinking middle class to which Uber was restricted. A big part of Uber’s appeal in many markets is its removal of the need for drivers and passengers to haggle over price. Yet Effiong questions whether this model was ever suited to Nigeria, a market that is “defined by price bargaining.” He points out that in practice, Uber drivers often negotiated fares directly with customers, cutting the platform out of the equation and causing it to miss out on revenue. Effiong adds that inDrive has been “the biggest disruptor in the market” in recent years, due to its innovation in allowing passengers and drivers to negotiate fares via its platform. Uber U-turn Uber is now a listed company that is more focused on maximising profitability over securing market share. Rather than ride out the inevitable bumps in the road that come with markets like Nigeria or Uganda, it appears to be re-orienting its business towards countries where it can maximise its returns. In fact, it is pinning much of its hopes on being able to deploy robotaxis – an innovation that avoids the inconvenient problem of having to share profits with human drivers. But Uber’s demise in Nigeria does not mean that ride-hailing is dead – and rivals that have put more emphasis on adapting their business models to serve local needs appear better placed to succeed. Africa is a continent of rapidly growing megacities, where car ownership is a struggle for much of the population, and where public transport is either non-existent or inadequate for the vast majority. Other digital mobility offerings that pay greater attention to local market realities may be able to find a way to succeed where Uber has failed.