News
Growing Ride-hailing Sector to Boost Vehicle Sales
While vehicle sales in Sub-Saharan Africa (SSA) are expected to continue on a downward spiral this year, the burgeoning ride-hailing industry in the region offers automakers and car dealers an opportunity to develop a new sales market.
This is according to the Sub-Saharan Africa Autos Report, compiled by credit intelligence provider Fitch Solutions, which provides a landscape of vehicle sales in the region, trends and a forecast for the market.
The report includes the Autos Sales Risk/Reward Index, which ranks the relative attractiveness of the market for vehicle sales activities, based on several ‘risks’ and ‘rewards’.
The report forecasts the region’s vehicle sales market is expected to slow by 5.6% year-on-year, from 930 000 units in 2021, as countries struggle to record full economic recovery, since the onset of the COVID-19 pandemic in Q1 2020.
This is still an improvement, compared to a contraction of 23.5% in 2020.
The commodity prices, along with high used vehicle prices (given the SSA market is dominated by imported used vehicles which are in short supply amid the global chip shortage), will see continued strong headwinds for vehicle sales, notwithstanding strong upside risk by the end of the year if currencies strengthen.
However, it notes the blossoming ride-hailing sector in the region has the potential to save the market, by becoming a key driver of a new vehicle sales vertical, as it allows for income earned through rides to contribute towards down-payments for new vehicles.
“Automakers and car dealers have an opportunity to tap into this sector by partnering with financial intermediaries, such as commercial banks and fintech start-ups, to offer tailor-made vehicle financing solutions intended for ride-hailing services.
“For example, in August 2021, Uber, along with Moove, raised $23 million to offer drivers and prospective vehicle owners financing options based on key metrics, such as the number of rides performed and income generated from rides completed.
“Vehicle repayments are then deducted from the borrower and the remainder of the balance is debited to the borrower’s Uber account. We believe this offers a less risky way for the financial sector to extend loans intended to purchase new ride-sharing vehicles in the region,” notes the report.
According to Fitch Solutions, the majority of markets in SSA are characterised by low incomes and high borrowing costs, which impedes the development of a new vehicle sales market.
In addition, liberal regulations with regards to the importation of used vehicles add more pressure to the development of a new vehicle sales market.
Under the ‘vehicle ownership per 1 000 people’ indicator in the Autos Sales Risk/Reward Index, the average number of vehicles owned in the region is 30. In 2021, the majority of countries in the region had 30 vehicle owners or less per population of 1 000 people, including SA (35), Botswana (50), Gabon (50), Zambia (20), Côte d’Ivoire (5), Namibia (25) and Angola (5).
While SA’s ride-hailing market is dominated by international players Uber and Bolt, over the past few years the industry has seen increased competition, with new African start-ups, such as InDriver, DiDi, NextNow, Taxi Live Africa and Africa Ride entering the market.
“The opportunities presented by the ride-hailing sector in SSA offer automakers and car dealers a source of demand for a wide range of vehicle types to tap into. For example, high passenger capacity ride-hailing services would give rise to demand for minibuses, by tapping into a market currently serviced by traditional and well-established but highly-informal transport operations,” notes the report.
It also highlights some short- to medium-term risks to the favourable outlook for ride-hailing in SSA. These come in the form of regulatory pushbacks from governments and retaliatory actions such as intimidation tactics against the deployment of ride-hailing services by existing public transport operators.
The African Development Bank (AfDB), has disclosed plans to work with the Lagos Metropolitan Area Transport Authority (LAMATA), to boost the state’s transport system with the development of another rail line.
This was contained in a statement signed by, the Head, Corporate Communication, LAMATA, Mr. Kolawole Ojelabi in Lagos.
Ojelabi said that the AfDB Vice President, Private Sector Infrastructure and Industrialisation, Mr. Solomon Quaynor, gave the assurance during a visit to LAMATA.
He added that the bank was interested in partnering LAMATA to expand the capacity of the existing rail system.
“Quaynor was also in the company of the Non-Sovereign Operations and Private Sector Equity Specialist, Mr Mayowa Ayodele ahead of a visit of the technical team to assess the Purple line,” he said.
The Purple Line is a 60-kilometre railroad along the Redemption Camp in Ogun State, traversing Berger, Agege and Alimosho and terminate at Volkswagen to join the Blue Line.
“The visit follows a recent pitch for investment on 60-kilometre Lagos Rail Mass Transit (LRMT) Purple Line at the African Development Bank forum in Morocco, where the Lagos delegation was led by Governor Babajide Sanwo-Olu.
“This is to further discuss collaboration on the project and other lines outlined in the Lagos Strategic Transport Master Plan. The delegation toured the LRMT Blue Line and expressed satisfaction with the progress of the Blue Line rail system,” he said.
Socio-Economic Rights and Accountability Project (SERAP), has filed a lawsuit against the Nigerian government the 36 states over the Cybercrimes (Amendment) Act 2024.
SERAP is arguing that “the repressive use of the Cybercrimes (Amendment) Act 2024 by the government to criminalize legitimate expression violate the human rights of Nigerians, including activists, journalists, bloggers and social media users”.
In a statement on Sunday, Kolawole Oluwadare, deputy director, SERAP, explained that the suit was filed to stop the Tinubu administration and Nigeria’s 36 governors from using the Cybercrimes (Amendment) Act 2024 to criminalize legitimate expression and punish Nigerians, including social media users.
He said: “Rather than using the amended legislation to make cyberspace and its users safer, Nigerian authorities are routinely weaponizing it to curb Nigerians’ human rights and media freedom.
“The suit no: ECW/CCJ/APP/03/2025 was filed last week before the ECOWAS Court in Abuja.”
Recall that Economic Community of West African States (ECOWAS) Court had on March 25, 2022, declared Section 24 of Nigeria’s original Cybercrimes Act 2015 as “arbitrary, vague, and repressive.”
The court ordered Nigeria to repeal the provision, citing non-compliance with human rights obligations under the African Charter on Human and Peoples’ Rights and the International Covenant on Civil and Political Rights.
Although the Cybercrimes (Amendment) Act 2024 repealed Section 24, the Socio-Economic Rights and Accountability Project (SERAP) argues that the reworded provisions still infringe upon freedom of expression and information.
SERAP’s concerns center around the ambiguity of “causing a breakdown of law and order” in Section 24(1)(b), which they believe threatens peaceful and legitimate expression and leaves room for abuse.
SERAP highlighted several instances where the law was allegedly misused to target government critics, including activist Dele Farotimi, journalist Agba Jalingo, and social media user Chioma Okoli.
The organization emphasized that the amended legislation has a chilling effect on human rights and media freedom.
SERAP stressed that the amended Act contravenes international human rights law, which requires restrictions on freedom of expression to serve a legitimate purpose and be strictly proportionate.
The organization seeks a declaration that Section 24 of the Cybercrimes (Amendment) Act 2024 is unlawful and an order directing the government to repeal or amend the legislation in compliance with international standards.
However, a hearing date has not been set for the suit.
Guild of Corporate Online Publishers (GOCOP) has applauded Mr. Monday Okpebholo, Edo State governor, for the appointment of Mr. Collins Edomaruse as his Special Adviser, International Development Partners (IDP).
Ms Maureen Chigbo, president of GOCOP and publisher of RealNews Online, described Edomaruse’s appointment as a welcomed development.
Chigbo in a press statement by Ogbuefi Remmy Nweke, GOCOP Publicity Secretary, also congratulated Edomaruse for this appointment assuring of support from over 110 members of GOCOP in carrying out his duties.
Until his appointment, Edomaruse who is a founding member of GOCOP and the Secretary General of the body of reputed online publishers is also a member of the Nigerian Guild of Editors (NGE), among others.
Edomaruse doubles as the Publisher/Editor-in-Chief of METROWATCH, and has held several senior editorial management positions in THISDAY, including Group News Editor, Group Politics Editor, Deputy Editor, Daily, Saturday and Sunday titles respectively, as well as the Editor, Nation’s Capital/Abuja Bureau.
Also known as ‘General’ because of his mastery of the Defence Beat, his records in THISDAY have remained unbeaten, where he ranked the best among the editors.
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