Driving for Uber When You Can’t Afford a Car
In South Africa, extreme inequality means that drivers have a much more difficult time turning a profit with the ride-share service.
In 2013, Uber was in the midst of an aggressive global expansion when it launched in South Africa. The app requires a critical mass of drivers to function properly, otherwise riders must wait prohibitively long for trips. In Cape Town, a Zimbabwean driver who I will call Mike (he asked that his name not be used because he fears deactivation for criticizing the platform) attended several meetings held by Uber managers seeking to win over potential drivers. He enjoyed the free sandwiches and coffee they offered him. “In the first six months those guys were beautiful to us,” he recalled.
After arriving in Cape Town, Mike had initially worked in hotels and restaurants, later becoming a meter-taxi driver. When he heard about Uber from some former colleagues—they spoke of higher earnings, no shift managers—he immediately signed up. Uber’s pitch to drivers was the same as it is everywhere else: “Make good money. Drive when you want. No office, no boss.” Mike’s first impression of Uber, he said, was, “Here comes a company that’s liberating me.”
But in South Africa, Uber’s model doesn’t work the way it can in some other countries. The country’s severe income disparity means that few professional drivers actually own the cars they drive; instead, they rent them from owners and split the earnings, very often struggling to make ends meet. Though Uber does not release its figures, drivers and their representatives estimate that since 2013, the service has grown to around 4,000 Uber cars in Cape Town, mostly driven by foreign African migrants. A substantial majority do not own their cars—a model that Mike soon came to believe was “broken.” Here, more than anywhere, the gig economy’s promise of independence was illusory.
From the start Uber had faced a problem in South Africa, as well as in other developing countries such as Pakistan and Mexico: While there was no shortage of willing drivers, few could afford vehicles suitable for the app’s high-end market—sedan cars no older than five years, which in South Africa cost at least $10,500. The national unemployment rate, including people who have given up looking for work, exceeds 35 percent, and more than half the population lives below the poverty line.
Were South Africa simply a poor country, there would have been no demand for Uber in the first place, but it also holds the distinction of being among the least equal societies on earth. Though unemployment and poverty are rampant among people of color, cities like Cape Town and Johannesburg have robust middle classes, with many thousands of people wealthy enough to use on-demand car services. To tap into this new market, Uber devised a solution to the car-ownership problem: Find people with the means to finance new vehicles, and encourage drivers to work for them. Today some of these owners, who like drivers are termed “partners” by Uber, operate entire fleets. One Cape Town partner (who asked not to be identified) currently has 50 vehicles on the road. There are even companies offering end-to-end fleet-management services. Since launching in San Francisco in 2010, Uber has spread to more than 814 cities (and counting). But in countries like South Africa, rather than disrupting entrenched patterns of capital, Uber’s version of the gig economy has largely conformed to them.
Samantha Allenberg, a spokeswoman for Uber South Africa, declined to comment on the proportion of drivers engaged in third-party agreements. “We are aware that some drivers work for vehicle owners and would like to be their own bosses,” she said. “Driving for someone else is the first entry point for drivers to join the Uber app.” Allenberg added that the company had partnered with local banks and car dealerships to offer financing for drivers with low credit ratings.
Yet ownership by drivers remains exceedingly rare. Faiza Haupt, an Uber partner who is helping to create a new national e-hailing association for drivers, estimates that just 10 percent of Cape Town’s Uber drivers work for themselves. (Haupt, a former driver, currently has four vehicles on the platform.) Mike, who has only ever driven for partner-owners, including one fleet that rotated drivers on consecutive 12-hour shifts, believes the figure is even lower.
“Uber in Cape Town is not functioning in the way Uber portrays it,” Ine Geitung, an Oslo city employee who wrote a Master’s thesis on the ride-hailing app in South Africa, told me. “Uber should put stricter and better guidelines between car owners and drivers to ensure that their platform does not contribute to exploitation, as it does today.” Critics such as Geitung, along with many Uber drivers, believe that Uber unfairly profits at the expense of the workers who make its service possible in South Africa.
Allenberg, of Uber, contested that characterization. “The lion’s share of the revenue generated goes to the driver,” she said, noting that Uber applies a standard service fee for 25 percent in all cities. The cost of running and improving the Uber app comes out of Uber’s service fee, she added.
Like their counterparts elsewhere, drivers in South Africa have attempted to force Uber to recognize them as employees, not contractors. In 2016, seven drivers—some working under partner-owners, some for themselves—took the company to court and won, but Uber successfully appealed. The drivers, who had founded a group called the Independent Drivers Guild, had already been deactivated from the platform. “The contract states that Uber can terminate you for any reason,” one of the drivers, Joseph Munzvenga, told me. Regarding the prevalence of partner-owners, he added: “As African people, with our histories of colonialism and apartheid, who can afford such a premium vehicle? The idea has become empowering people who were already rich.”
Typically, owners set drivers’ weekly “targets,” ranging from $190 to $230, which drivers must pay them before they can start earning money themselves. Some owners are registered with Uber and pay out earnings to their drivers, minus these deductions; in other cases, the drivers are registered themselves and must deduct rental fees from what they earn. Either way, drivers must pay for their gas and cellphone data. This leaves little over for drivers, many of whom work 60-hour weeks or longer. (With rising insurance premiums and competition for riders, many owners say that the model is no longer working for them either.)
Records from Mike’s app shows that he pockets less than $760 most months, though he works, on average, 65 hours per week; his wife, who works a nine-to-five job, makes more. Uber traffic is busiest on weekends, so while his wife and children are home, Mike is generally on the road. “If I was earning well it might be worth it for a few years,” Mike said. “But I’m not, and I’m not spending any time with my children. This way, what’s the point?”
Until this May, when Uber South Africa imposed a 12-hour shift limit on its app (excluding waiting time between rides), Mike often drove for 20 hours or longer in pursuit of better earnings. Like many other drivers I met, he began keeping a blanket in his trunk for naps. Late one night, after he dropped a customer at home, the man refused to open his driveway gates to let Mike leave. “He could see how tired I was,” Mike told me. “He was a gentleman—he made me sleep in the car until morning.” Another time Mike ordered an Uber for himself after going drinking. The driver was red-eyed and slurring with exhaustion. “I canceled the trip and told him to go home, but I don’t think he did,” Mike said.
Uber South Africa sent drivers a short video this July, announcing the findings of a national costs survey. Both rentals and vehicle finance had grown more expensive with inflation, while car-insurance premiums had more than doubled since 2015. A recent petrol price hike had squeezed drivers even further. “On top of these increases in your operating costs, inflation has caused the cost of everything else in your life to go up as well,” a narrator explained, over piano music. “All of this means that your earnings are not enough.”
On August 1, the company announced that it was increasing its minimum fare charge for UberX trips by 25 percent and piloting “tiered” discounts on its fees for drivers with good track records. “It’s a big F-you to drivers,” Mike wrote me by WhatsApp when he saw the news. Boosting the minimum charge makes a difference only to extremely short trips, and he found the commitment to discounts vague. Allenberg, the Uber spokeswoman, said: “Uber suceeds when our partners suceed, and our teams are working hard every day to ensure drivers using our app continue to thrive.”
After more than 10,000 trips, Mike said, he was tired of waiting. He recently completed a part-time course to become a tour guide. (“Due to financial constraints,” he said, it took him a year instead of the typical six months.) He meets other men all the time, Zimbabwean immigrants like him, who want to drive for Uber. He has given up arguing that they are wasting their time. Driving a nice car feels like a good job—a status symbol—even if the weekly payments are too steep for it to be at all lucrative, he said. Compared to what they earned back home, the money isn’t bad. People learn not to touch fire, Mike has learned, when you let them burn their fingers. No matter what happens, Uber will get its cut.