Uber’s exit opens new battle for Nigeria’s ride-hailing market

Uber’s exit from Africa’s most populous country is set to intensify competition among ride-hailing companies, as competitors move to capture drivers and passengers left behind by one of the sector’s biggest players.

The platform’s departure after being in operations for 12 years, is expected to reshape Nigeria’s competitive e-hailing market, as other platforms position themselves to capture its market share.

“Nigeria’s ride-hailing market is large and active, but it is a high-cost, low-margin business. Riders want cheap, available trips, while drivers carry almost all the cash costs,” Ayoade Ibrahim, co-founder & secretary general of the Amalgamated Union of App-Based Transporters of Nigeria (AUATON), said.

Ibrahim said that riders have used multiple apps to compare prices, and fewer serious options means less discipline on surge and base fares, highlighting the recent issue with airport officials when Uber and Bolt access was restricted, conventional airport cabs pushed prices up sharply, with reports of fares rising by about 50 percent.

Read also: Uber’s African retreat deepens as Nigeria, Uganda join exit list

He added that Uber’s exit reveals that volume is not the same as profit, and Nigeria can generate many trips and still fail a global return-on-capital test.

Nigeria has a large ride-hailing market but still operates under significant cost pressures, including fuel, vehicle maintenance, driver earnings, insurance, technology, payment costs, regulatory requirements and customer incentives.

The rising cost of running vehicles has continued to squeeze margins across the sector, making it difficult for platforms to keep fares affordable while ensuring drivers earn enough to remain on the road.

Uber’s exit therefore raises a broader question about whether Nigeria’s growing ride-hailing demand can support a commercially sustainable business model.

On the potential impact on fares, driver earnings and competition, Opeyemi Ajetunmobi, a capital market and structured finance expert, said the outcome of Uber exit would likely vary across markets and customer segments.

Ajetunmobi explained that if Uber’s departure significantly reduces competition, surviving platforms could gain greater pricing power, potentially putting upward pressure on fares over time.

Drivers, he said, are likely to compare platforms based on net earnings, trip volumes, commissions, incentives and operating costs, meaning platforms seeking to retain the best drivers may have to offer more attractive economics.

Read also: Here are delivery alternatives for Nigerian SMEs after Uber’s exit

“The competitive battle is likely to become less about simply acquiring passengers and more about building a sustainable driver-partner and customer ecosystem,” Ajetunmobi said.

He added that Uber’s exit is unlikely to translate into a straightforward transfer of its entire customer base to competing platforms, noting that some users may switch to other ride-hailing services, while others could reduce their reliance on app-based rides altogether as affordability remains a major concern for Nigerian commuters.

Who stands to gain from Uber’s exit?

Nigeria’s ride-hailing market has been largely shaped by major platforms such as Bolt, inDrive and Uber, which have competed for commuters across key urban centres including Lagos, Abuja and Port Harcourt.

However, with Uber now leaving the market, the competitive landscape is set for a shift, creating an opportunity for existing operators to capture some of the demand it leaves behind.

Platforms such as Bolt, inDrive and LagRide, alongside other emerging mobility players, are likely to intensify efforts to attract both passengers and drivers as they position for a larger share of the market.

“Bolt and inDrive are best positioned to capture a significant share of the passengers and drivers Uber leaves behind, given their established presence and scale in Nigeria,” Ibrahim said.

As the ember rush approaches and travel demand is expected to rise, ride-hailing platforms are already positioning to capture a share of the market Uber is leaving behind.

LagRide in a recent announcement, stated that they are ramping up capacity ahead of the 2026 ember rush, deploying 400 new vehicles across Lagos and seeking to mobilise more than 1,000 additional Captains by December as it positions to capture a larger share of the market.

inDrive is also growing with a strong available and negotiated price-sensitive trips, offering an alternative to Uber’s fixed model.

“Smaller apps such as Rida and newer pan-African or local platforms can take a slice if they have cars in the right neighbourhoods,” Ibrahim said.

He further said that the companies that last will be the ones that can hold a fare high enough for drivers and low enough for riders, while still funding support, insurance and compliance.

“Multi-app drivers will go where trips and net pay are best. City coverage, local payments, family or corporate accounts, and working relationships with Lagos, FCT and FAAN will matter more than a global brand now that the global brand has left,” Ibrahim said.

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