Safaricom-backed courier firm Sendy has terminated its online taxi hailing service to concentrate on its core logistics business at a time when competition in the cab sector is growing.
Sendy Ride, the on-demand taxi and motorcycle service offered by the company, was shut down last month after just two months in operation.
Meshack Alloys, the Sendy chief executive officer, said they have been piloting the taxi business and the decision to pull the plug on it will enable the company expand its courier services.
Competition in the taxi hailing business has been growing since San Francisco based Uber launched in January 2015, with companies like Mondo Ride, Little Ride, Taxify, Easy Taxi and Pewin now offering similar services.
“We have suspended the pilot since October. (This is due to) demand from our customers in the core logistics business which has been expanding,” Mr Alloys told the Business Daily in a telephone interview.
“We will use the data collected during the pilot to determine a way forward in the passenger business.”
The tech start-up was launched in September 2014 linking parcel senders to a network of transporters using motorcycle, van and pick-up trucks to deliver goods.
“We had a few vehicles for the passenger business. Motorcycles had their carriers removed to allow for passengers,” said Mr Alloys. The company’s mobile application allows senders to keep track of the goods in transit through live updates.
Sendy, which received Safaricom support in November last year through its Spark Fund, ventured into the taxi business in August while also expanding its logistics business to Kisumu, Mombasa and Thika.
The company has a fleet of 800 vehicles which include motorcycles, trucks and pick-ups.
Sendy was charging motor cycle customers Sh200 per kilometre for rides less than seven kilometres and Sh30 for longer trips. Cab passengers were parting with a minimum of Sh300 for up to three kilometres and thereafter Sh70 per kilometre.
Kenya’s fledgling e-taxi market has experienced immense activity over the past two years with several companies entering the lucrative business which is dominated by Uber.
It is estimated that there are over 10,000 taxi cabs in the Nairobi metropolis, with each vehicle doing an average of four trips per day. The fight for passengers has resulted in a price war with Uber, Taxify and Mondo Ride all slashing fares to attract customers.
Mondo Ride and Little have innovated to offer a budget option where riders pay lower rates by using older taxis.
Kenya Bus Service has revealed plans to start a high-end hailing service that will include Mercedes and sport utility vehicles to cater for the untapped segment of the taxi business.
Sendy’s exit from the passenger business will be especially beneficial to firms such as Mondo Ride and BodApp which offer motorcycle hailing services.
BodApp is a motorcycle hailing app launched last month in partnership with Telkom Kenya. Baxi, an Indian on-demand motorcycle taxi company has also announced plans to begin operations in Kenya by the end of the year.