Uber’s decision to end its operations in Nigeria after 12 years has triggered mixed reactions, with industry stakeholders linking the move to intense competition, rising operating costs and Nigeria’s difficult economic environment.
The ride-hailing giant announced that it would wind down operations in Nigeria and Uganda effective September 2, 2026, following what it described as a “thorough review” of its operations.
“After a thorough review, we have taken the difficult decision to wind down operations in Nigeria and Uganda, effective September 2, 2026,” Uber said.
The company said the decision would not affect its operations elsewhere in Africa.
Uber also deactivated its booking platform in Nigeria shortly after the announcement, affecting drivers and other young Nigerians who relied on the platform for their livelihoods.
The company said its immediate priority was to support drivers, riders and local team members during the transition. Its Help Centre will remain available until September 23 for customers with final account-related queries.
The Guardian reported that a consultant and a leading audit firm had also written to Uber’s management to reconcile its retainership account following the announcement.
Tough economics hit ride-hailing
Uber’s exit comes as Nigeria’s e-hailing sector grapples with rising fuel prices, vehicle maintenance costs, regulations and intense competition from platforms such as Bolt and inDrive.
Industry experts said the economics of operating petrol-powered vehicles had become increasingly difficult, with fares often failing to provide drivers with reasonable returns.
Fuel prices have risen sharply since President Bola Tinubu assumed office, while the transition to compressed natural gas (CNG) has remained challenging because of conversion costs, limited infrastructure and availability.
An economist and lecturer at Olabisi Onabanjo University, Prof. Sheriffdeen Tella, attributed Uber’s departure to intense competition and a harsh operating environment.
However, he said the effect on Nigeria’s wider economy would be limited.
“Definitely, it will affect employment rates in Nigeria, but it will not be significant because some of their drivers would move to other platforms. Output level won’t be impacted significantly,” Tella said.
“It will only affect some levels of unemployment like drivers, artisans and their staff because they have to lay off some workers.”
Uber had onboarded more than 7,000 drivers in Nigeria as of 2017, although the company did not disclose its current driver numbers.
Drivers face uncertainty
The Lagos State Chairman of the Amalgamated Union of App-Based Transporters of Nigeria (AUATON), Jaiyesimi Azeez, said Uber’s exit should prompt a broader review of Nigeria’s app-based transportation sector.
Azeez said the development should not be treated simply as the departure of one company but as a warning about the sustainability of the country’s digital mobility ecosystem.
“For drivers, the immediate concern is livelihood.
“Government and other industry stakeholders must ensure that affected drivers are not simply left to fend for themselves.
“With one of the major players leaving the market, there is a possibility of reduced choices and changes in fares and service conditions,” the AUATON chairman said.
He called for a stakeholders’ dialogue involving the Federal and Lagos State governments, regulators, ride-hailing platforms, driver unions, riders and fleet owners.
Azeez also said Uber’s departure could provide an opportunity to strengthen indigenous technology and mobility companies, while warning local operators against repeating challenges faced by drivers on existing platforms.
Bolt, Lagride reject exit concerns
Bolt Nigeria said it had no plans to leave the Nigerian market.
The company’s Public Relations Manager, Femi Adeyemo, said: “We continue to see significant opportunities in the market and remain focused on providing reliable mobility solutions for riders while creating economic opportunities for drivers and entrepreneurs across the country.”
Lagride also said it was not following Uber’s footsteps.
Its Public Relations Director, Ifeanyi Abraham, said the company was instead expanding its operations, including through the launch of 400 new vehicles and captains.
“We just launched 400 new vehicles and captains (riders) into the market and we expect significant growth in demand in the final quarter of the year, particularly as mobility demand increases during the ember and festive periods,” Abraham said.
He said Lagride was also ready to work with state governments and other institutions on government-backed mobility projects.
However, Abraham identified the high cost of vehicle acquisition, access to affordable financing, fuel, operating expenses and maintenance as major challenges facing the sector.
Uber exit not caused by FAAN, company says
Uber’s departure also comes weeks after the Federal Airports Authority of Nigeria (FAAN) suspended Uber and other e-hailing platforms from operating at the nation’s airports.
However, Uber exonerated FAAN from responsibility for its decision to leave Nigeria.
E-hailing operators have faced regulations from both state governments and federal agencies, with industry players calling for reviews of rules they consider burdensome.
Petrol costs squeeze drivers
Uber driver Tobi Ladipo said the company’s exit could be linked to the worsening economics of ride-hailing, particularly for drivers using petrol-powered vehicles.
According to Ladipo, petrol costs have risen to a point where fares generated through e-hailing platforms no longer provide reasonable returns.
“For those using CNG, the charges by the e-hailing platforms are okay. But for fuel-powered vehicles, it is not good enough for us,” he said.
Ladipo said petrol could cost as much as N1,350 per litre, compared with about N380 per litre for CNG in some instances.
He added that the difficult economics had already pushed some Uber drivers towards rival platforms, particularly inDrive.
Ladipo said Uber’s total charges amounted to 16 per cent, comprising 7.5 per cent VAT, a 6.1 per cent platform charge and another two per cent in deductions.
He said other platforms charged about 14 per cent or less and were more open to discussions around charges.
He also said competition among e-hailing companies had contributed to pressure on drivers, as platforms reduced fares to attract passengers.
“The e-hailing companies are competing with one another. To remain in business, they reduce the fares for passengers, which is not good enough for the drivers because, in the long run, we get almost nothing for using their platforms,” Ladipo said.
He estimated that converting a Toyota Corolla from petrol to CNG could cost between N800,000 and N1 million, describing the expense as significant for drivers already struggling with fuel and maintenance costs.
Purchasing power remains a major challenge
An X user, Oluwatosin Olaseinde, said Nigeria’s population of more than 200 million did not necessarily translate into a large addressable market for Uber.
She argued that e-hailing services depended on customers with smartphones, purchasing power and reliable internet connectivity.
According to her, purchasing power was probably the biggest structural challenge facing the sector.
“Nigeria could have enormous demand for mobility, while simultaneously having relatively low purchasing power,” she said.
She added that when household incomes are under pressure, transport becomes highly price-sensitive.
She said consumers increasingly prioritise the cheapest available option over differences in platform experience.
“Consumers don’t necessarily ask: Which platform has the best experience?” she said. “They ask: ‘Who can get me there for the least money?’”
Olaseinde said Bolt, inDrive and local platforms had intensified competition in the sector.
She also cited an unconfirmed estimate that put Nigeria’s e-hailing market at about $450 million in 2025, with projected growth towards almost $1 billion by 2032.
Uber’s exit leaves other platforms competing for drivers and riders while raising fresh questions about the sustainability of Nigeria’s rapidly evolving e-hailing industry.
