The Lagos state government yesterday announced that it is set to roll out a fleet of 1,000 ride-hailing Sports Utility Vehicles (SUVs) as part of its new “Lagos Ride” scheme. This comes on the back of its partnership deal with Chinese auto manufacturer, CIG Motors Co. Limited, which will also establish a vehicle assembly plant in the state.
Recall that the Lagos government has in recent times been making efforts to crackdown on ride-hailing startups including Uber and Bolt. The moves hinted at the government’s ulterior motive of entering into the lucrative e-hailing market.
So far, these are the facts we have gathered about the government’s Lagos Ride scheme as well as concerns raised by e-hailing driver-partners (Uber and Bolt drivers).
1,000 SUVs to be Deployed in 6 Months
The Lagos state government has disclosed that a total of 1,000 sports utility vehicles (SUVs) will be deployed under the scheme. These vehicles are expected to be unveiled in the next six months, according to the government.
Going by this, Lagos Ride vehicles may probably launch out on Lagos roads sometime in September 2021, other things being equal.
Social Intervention Scheme
Lagos Ride is one of the state’s social intervention programmes directed towards the provision of job opportunities and poverty alleviation for residents of the state as well as the empowerment of persons in underserved communities.
Also, the government says it wants to “create a seamless multi-modal transportation system” through the scheme.
Hire Purchase Model
The Lagos Ride e-hailing service would operate a hire purchase model for drivers. Vehicles are owned by the government, so drivers might be hired as employees until they complete payment for the vehicles, and not independent contractors/partners.
According to the government, the Cooperative Society in the Ministry of Wealth Creation and Employment would oversee the lease of the new SUVs to drivers for four years. During that entire period, drivers would have to pay a monthly instalment fee.
What this could mean is that the government would charge a commission on drivers’ monthly total earnings as the state would expectedly hold the funds coming through. At the end of the four (4) years, drivers can then complete an outright purchase of the vehicles.
Mobile App or Not?
The Lagos government describes its Lagos Ride service as an e-hailing taxi scheme. Therefore, one may not be wrong to expect it to work with a web or mobile app. However, there is no indication of the presence of an app yet.
Should it come with an app, one wonders whether the app will be available to all interested drivers just like Uber and Bolt. If this were to be the case, then any driver could register on the platform.
However, it is also possible that the app is only accessible to the drivers whom the government leases the cars out to. What would then result is that only those who are selected by the state can drive with Lagos Ride.
Uber/Bolt Drivers React..
As regards the pending launch of Lagos Ride, some Uber and Bolt drivers who spoke to Technext have expressed a number of concerns on issues such as regulation, transparency and unfair competition.
Weighing their Concerns
It is only right that Uber and Bolt drivers are worried about potential draconian regulations which could further be enforced by the government. After all, such regulations forced bike-hailing startups like Max, ORide and Gokada out of business.
A Bolt driver who spoke on behalf of his colleagues said:
We had almost the same opinion. Some were scared they will put Uber/Bolt partners out of jobs as they did e-hailing bikes.
“We believe the Vehicle Inspection Officers VIO and Lagos State Traffic Management Authority LASTMA will start targeting those of us who are yet to complete our car papers for e-hailing,” he said.
He added that the government has asked drivers to get some extra documents costing N17,000, without which they would not be able to work with Uber/Bolt. The Bolt driver was perhaps referring to the mandatory auto hackney permit (N15,000) and Lagos State Drivers’ Institute (LASDRI) certification (N2,000).
“Some of us have not done it because Uber/bolt has not made it mandatory,” he said.
In a chat with Technext, President of the National Union of Professional App-based Workers (NUPA-BW), Comrade Ibrahim Ayoade also echoed regulatory concerns:
We’re not sure how government wants to go about helping app-based drivers on the platform because they may introduce new regulations and policies that would favour them in the system. They may frustrate Uber/Bolt drivers out of market.
Comrade Ibrahim Ayoade
Ayoade goes on to talk about why the driver onboarding process for Lagos Ride may not be wholly transparent due to political interference.
“Our fear is how transparent the programme would be. Anything the government puts hand to is always hijacked by politicians without any knowledge of the particular business. Let me give you a typical example. During Fashola’s time as governor, they gave out yellow cabs, but today you don’t see most of those vehicles out again because of mismanagement.”
He then called for the government to engage the union before going ahead with the Lagos Ride scheme.
Lagos government should learn from previous mistakes and work with us to give good information about the gig economy. They are looking at the money that would come out of it but there is more to it.
The NUPA-BW boss, however, acknowledged that the scheme could still prove beneficial. He explained that e-hailing drivers would have more vehicles to work with and the competition could pressure Uber/Bolt to better support their driver-partners.
Meanwhile, Bolt/Uber drivers have questioned whether the Lagos Ride scheme is sustainable. Many do not see the Chinese SUVs surviving Lagos roads, stating that high vehicle maintenance costs and fuel consumption could drive up fares, thereby reducing the market appeal to riders.
Ayoade agrees with this position, stating that fares could be on the high side compared to Uber/Bolt, which the bulk of riders may not be able to afford.
Going forward, it remains to be seen how the Lagos Ride scheme will eventually play out.
If you’d like to get featured on our Entrepreneur Spotlight, click here to share your startup story with us.
Get latest Technology news, reviews, business-related content with a deliberate emphasis on the African narrative and insightful analysis in Nigeria – straight to your inbox.