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Governing bodies threaten shutdown of 'Bolt's manipulative system'

Read time 4min 40sec

Independent governing bodies representing Bolt drivers and ride hailing operators across SA are demanding the halt of Bolt’s new low-cost service, Bolt Go, threatening to protest if it continues to operate.

The threat comes a few weeks after the ride-hailing firm launched what it bills the “cheapest ride-hailing service in SA”, which offers fares that are approximately 20% less than regular Bolt rides.

The addition of the low-cost category, according to Bolt, aims to significantly lower the barriers to entry into the South African ride-hailing industry by empowering owners and drivers of hatchback vehicles to access the Bolt platform and earn an income for the first time, while offering riders a more affordable option.

The affordable service has been successfully trialled in East London and Port Elizabeth, and this week it rolls out across 35 cities and towns where Bolt is active.

In two separate memorandums seen by ITWeb, the South African E-hailing Association and the E-hailing Operators Interim Committee express their anger at what they call “Bolt’s manipulative system”. They threaten that their Bolt members will shut down Bolt’s ride-hailing services across SA by Monday, 27 July, if the new service does not cease to operate.

The bodies, which represent all ride-hailing drivers and operators in SA, claim the addition of the service will allow an influx of new vehicles, which will lead to Bolt operators and drivers earning a fraction of what they currently take home.

Bolt takes a 20% commission from each trip, with a booking fee of 5%. Trip charges cost an average of R7 per kilometre, depending on the city. Bolt Go charges riders an average of R5.50 per kilometre.

“We, the South African E-hailing Association, hereby wish to express our utter disappointment and dissatisfaction with the new Bolt Go feature which has recently been launched in SA. At R5.50 per km, this feature is unprofitable for our driver partners and fleet owner members and will definitely be unsustainable. With R5.50 per km before Bolt’s commission, this pricing structure leaves no room for our driver partners and fleet owners to even break even.

“We wish to inform you that we are giving Bolt SA until Friday, 24 July 2020 to remove the Bolt Go feature permanently as a ride option. Failing which, we will embark on a total shutdown as of Monday, 27 July 2020, where all of our Bolt e-hailing members will switch off the Bolt app until a resolution is sought. We can assure you it will not affect their pockets, as they have other apps such as Uber, etc, to fall back on,” writes the memo from the South African E-hailing Association.

Gareth Taylor, country manager for Bolt South Africa.
Gareth Taylor, country manager for Bolt South Africa.

Struggling economy

The ride-hailing industry is already in decline due to the fallout from the COVID-19 crisis. In April, aggrieved ride-hailing drivers and operatorslobbiedgovernment to include them in the COVID-19 Relief Fund, fearing their vehicles would be repossessed as their business takes a huge blow during the lockdown period.

In February, the ride-hailing drivers held a protest in Johannesburg against what they called “exploitation”, high commissions resulting in lower income and safety issues.

The E-hailing Operators Interim Committee memorandum writes: “As the E-hailing Operators Interim Committee, we reject Bolt Go with the contempt it deserves and we are angered by Bolt’s manipulative statement that they are committed to drivers' earnings as much as possible.

“It is clear that Bolt is using drivers’ desperation during these difficult times to lure drivers into submitting to a fare decrease at the expense of vehicle owners, while Bolt continues cashing in through their exorbitant commission.”

While joining the new Bolt Go category is fully optional for all the drivers, the committee says both scenarios will result in them working backwards – either competing against the new vehicles or earning less per trip.

“What an insult to drivers and owners’ intelligence as we all know that riders will prefer the bargain from Bolt Go over the standard Bolt service. With the current COVID-19, there is no business and if Bolt wants to introduce a different category of vehicles, that’s fine, but they should not adjust the standard fee,” notes the memo.

Responding to ITWeb, Gareth Taylor, country manager of Bolt South Africa, points out the South African economy is struggling with the impact of COVID-19 and many customers are price-sensitive during times like these.

“As a result, Bolt Go has been created to offer passengers a more affordable choice, which in turn generates more rides and more earning opportunities for drivers. While the fares for the rides in this category are 20% lower, Bolt has seen that the new service is in high demand among passengers where it has already launched.

“The drivers will make up for the discounted price in an increased quantity of rides, while passengers will get access to more affordable transport.When driving with Bolt Go, drivers keep ±R6.20 per kilometre, after they have paid the platform’s commission,” explains Taylor.

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