Last Update 19:24
Sunday, 12 July 2020

Egypt's ride-hailing market witnesses slowdown in rides amid coronavirus

The drivers of ride-hailing companies Uber and Careem are considering shifting careers as a result of a fall-off in demand during the pandemic

Ahmed Morsy , Thursday 14 May 2020
A slowdown in rides
Ride hailing services were hard hit by the lockdown (photo: Reuters)
Share/Bookmark
Views: 2523
Share/Bookmark
Views: 2523

The prolonged night-time curfew accompanied by working from home and e-learning policies introduced to halt the spread of the coronavirus have negatively impacted many businesses in Egypt, with ride-hailing being no exception.

“Since late March, we have been suffering a lack of demand for trips to the extent that we have reached a level that we are almost begging to be hired,” Sherif Labib, a 30-year-old married Uber driver, told Al-Ahram Weekly.

The US-based Uber launched in 2014 in Cairo, and according to the company it has helped more than four million people get around Egyptian cities since its launch in Egypt. About 200,000 drivers work with Uber in the country.

“Today [Monday], I only received one trip request from 8am until 4pm and it cost only LE20,” Labib, who has been working as an Uber driver for two-and-a-half years, said.

Labib used to work as a cashier in one of Cairo’s restaurants but quit because Uber offered a higher income. “But due to the tough situation that drivers are in today, I am seriously thinking of taking another job as continuing as a ride-hailing driver will lead my family to die of hunger,” Labib, the father of two children, said.

Lockdown measures have been imposed locally since mid-March to contain the spread of the virus, including a night-time curfew, the suspension of schools and universities, and the closure of places of worship.

Abdel-Ghaffar Zidan, who works as an Uber driver in addition to his regular job to increase his income, said the same thing. “Sometimes the revenue doesn’t cover the expenses of the petrol,” he said, adding that even during daylight hours the demand is “very small.”

Labib said that working from home and closing universities due to the pandemic had been the two main reasons for the scarcity of demand, as employees and university students were frequent Uber customers. 

For Hani Al-Sawi, another Uber driver, the decline in demand had been more than 50 per cent compared to conditions prior to the coronavirus pandemic. “This profession is currently suitable for someone who is working in his spare time to increase his income, but not for someone like me who uses it as his main source of income,” Al-Sawi said.

Al-Sawi, who is married and has children, said he wanted to change his career due to the pandemic. He is hesitant, however, because he lacks experience in other fields and a start-up business would need capital that he does not have.

Fadi Mohamed, another ride-hailing driver, said that half of the drivers were working for Uber as a second job, and they had opted to stay at home since the epidemic broke out for fear of infection and to preserve the safety of their families.

“The other half is forced to work as drivers because they have no other source of income,” Mohamed said. “Despite our commitment to safety and prevention measures, there is no demand for services compared to the previous period. I wear a mask and don’t turn on the air-conditioning but to no avail,” Mohamed added.

In the wake of the spread of the virus, Uber has sent drivers safety instructions, including wearing a mask, keeping windows open during the trip, cleaning exposed surfaces, and disinfecting after each trip.

“I am suffering but those who are suffering the most are those who depend on earning a living as a ride-hailing driver using a car purchased on installments,” Al-Sawi, who is working with his own private car, said.

Islam Abdel-Aziz, another driver, agreed and said he had “some friends who purchased cars on installments prior to the pandemic to work as ride-hailing drivers and now find themselves in a dilemma.

“Their revenue cannot cover operating costs, due installments, and their need for a livelihood, and so they have sold their cars to pay the installments and are now looking for another job,” Abdel-Aziz said.

Egypt, which is among Uber’s top 10 markets globally, was “one of the most important markets for the US-based ride-sharing company in the Middle East,” according to a statement in November by Tony West, Uber’s senior vice-president.

The company launched Uber Bus in Egypt for the first time worldwide last year, and earlier this year it was testing incorporating existing taxis into the ride-hailing service. In January, the Egyptian Competition Authority (ECA) approved Uber’s $3.1 billion deal to acquire Careem, its Middle Eastern rival in the ride-hailing business.

But due to the respiratory disease, the company laid off hundreds of office-based staff in Egypt last week as it made wider cuts amid the fallout from the new coronavirus, according to Reuters.

Quoting one current and two former Uber Egypt employees, both of whom had lost their jobs last week, Reuters said that about 40 per cent of staff in Uber’s Egypt offices had been laid off.

On 6 May, Uber Technologies Inc, which has 3.9 million of drivers on its platform worldwide, announced that it would cut about 3,700 full-time jobs and CEO Dara Khosrowshahi would forgo his base salary for the remainder of the year as the Covid-19 pandemic decimates ride-hailing businesses.

Uber said the layoffs, affecting 17 per cent of its employee count, included its customer support and recruiting teams and that it expected to incur about $20 million in costs for severances and related charges.

 

*A version of this article appears in print in the 14 May, 2020 edition of Al-Ahram Weekly under headline: A slowdown in rides

 

Short link:

 

Latest

© 2010 Ahram Online.