Uber ceases operations in Tanzania as pricing rules squeeze ride-hailing model

Years of clashes over fares, commissions and regulatory control are what the global ride-hailing company, Uber, has been facing in Tanzania for a long time. The company has informed both drivers and riders through the Uber app that its services would no longer be available in major cities, including Dar es Salaam, Arusha, Dodoma, Mwanza, and Zanzibar, as of January 30, 2026.

Uber expressed regret for the disruption and thanked customers for using its platform for nearly a decade. “After careful consideration, Uber has made the difficult decision to discontinue the Uber App services in Tanzania from 30 January 2026,” the company said in a message to customers last week. The company’s exit highlights how far a global ride-hailing model built on flexible pricing can work under strict, state-controlled fare rules.

Uber's departure has created more space for local and regional platforms such as Little and Bolt, which have proven more capable of adjusting their operations to fit Tanzania’s regulatory environment. When Uber first launched operation in Dar es Salaam in June 2016, it introduced app-based ride-hailing, digital payments, and competitive prices, which are the reasons the company was accepted by Tanzanians. Yet almost from the start, Uber’s global business model came into friction with Tanzanian transport regulators.

The exit follows a long-running dispute with Tanzania’s rigorous transport regulations, overseen by the Land Transport Regulatory Authority (LATRA). LATRA regulates ride-hailing more like traditional transport than an open marketplace. In 2022, the commission imposed a 15% cap on the commission ride-hailing companies could charge drivers, much lower than Uber’s usual 25% global rate. Uber said this made its business economically unviable and paused operations in April 2022.

The regulator later revised the cap upward, to around 25%, allowing Uber to resume in early 2023. Despite the reversal, LATRA's regulatory uncertainty still persisted. LATRA sets guide fares and minimum trip prices and caps the share platforms can deduct from drivers—rules that limit how companies take commissions and respond to changes in fuel costs or fluctuations in demand, stripping away the core tools of businesses that typically charge 18% to 30% commissions and use fare changes and bonuses to balance supply and demand.

Local players like Little, In-Drive, and Farasican survive in this business environment because they continue to serve mass-market riders, often relying on cash payments and lower commission expectations that align with LATRA’s structure. In other words, they were more active and flexible with local market conditions.

Even Bolt, Uber’s main international competitor across much of Africa, responded to the fare standoff in Tanzania by leaning more heavily into serving corporate customers. In addition to that, Bolt also expanded its services through motorcycle (boda boda) and tricycle (tuk-tuk) offerings, which are extremely popular with Tanzanian riders. This adaptability helped Bolt win market share.

But Uber’s exit is likely to affect pricing behaviour and availability. By the time of the company’s exit, Bolt reportedly had more than 30,000 drivers across eight cities, while Uber’s network was estimated to have around 1,500 drivers. Notably, many drivers already work across multiple apps to secure enough trips. So, only a little of the 1,500 drivers will be affected by the pullout; it only removes the largest international brand from a market where the state now plays a central role in setting the economics of each trip.

Its exit is now widely seen as a cautionary tale for other African markets such as Nigeria and Kenya, where regulators are paying closer attention to how ride-hailing companies’ algorithm-driven models function profitably at scale, particularly around pricing and driver welfare. It also serves as a reminder that global tech firms can hit hard limits when local regulations are strict and regional competitors are better adapted to the market. When fares and platform earnings are tightly controlled, the systems that align supply and costs no longer work, making the business unsustainable.