CIG Motors Takes Control of LagRide to Revamp Driver Operations and Model
CIG Motors has taken operational management of LagRide, aiming to improve conditions for drivers by changing the payment model from a drive-to-own system to a salaried approach. The new structure also includes plans for transitioning to electric vehicles. This move seeks to address concerns regarding high vehicle repayments that many drivers struggle with.
CIG Motors, the Chinese firm responsible for GAC vehicle assembly and distribution in Nigeria, has acquired the operational management of LagRide, a ride-hailing service supported by the Lagos government. This takeover signals a considerable change for LagRide, particularly regarding the vehicle financing model, which has faced criticism from drivers burdened by high repayment plans.
Under the new management structure, CIG Motors will oversee driver operations, fleet management, platform optimization, and vehicle financing. According to unnamed sources, this new arrangement aims to enhance the financial conditions for drivers, addressing concerns surrounding the previous payment framework.
Chairwoman Diana Chen is expected to supplant LagRide’s current drive-to-own system, in which drivers paid daily toward vehicle ownership, with a salaried employment model. This transformation includes offering a monthly salary of ₦150,000 ($98) per driver, shifting the focus from vehicle ownership to monthly remuneration.
This new salary model may decrease drivers’ earnings significantly compared to their previous income, where some drivers averaged ₦10,000 daily after deducting fuel and repayments. The promised salary of ₦150,000 represents only a small fraction of their former earnings.
CIG Motors also intends to transition the existing vehicle fleet to electric vehicles (EVs), although specific timelines for this transition have not been disclosed, according to sources familiar with the company’s direction.
The management change also impacts LagRide’s technical operations, as Tumi Adeyemi, the founder of Zenolynk Technologies, has departed LagRide to join Qoray, a company that specializes in EVs. As of yet, Adeyemi has not released any public comments regarding this move.
Launched in 2021, LagRide was designed as a cost-effective alternative to traditional Lagos taxis and competing global platforms, utilizing an asset-financing model that required a ₦700,000 ($458) down payment for leasing GAC vehicles.
However, rising inflation and living costs in Nigeria have complicated these payments for many drivers, leading to some abandoning their vehicles. The new salaried approach intends to stabilize driver earnings and enhance retention, indicating CIG Motors believes that satisfied drivers will lead to a more efficient operational environment.
CIG Motors’ takeover of LagRide reflects a strategic shift in operational management with an emphasis on improving driver conditions through a salary-based model and a transition to electric vehicles. This overhaul could stabilize the financial situation for drivers facing high repayment demands under the previous asset-financing model. The upcoming management changes aim to boost retention by creating a more sustainable and supportive environment for LagRide’s drivers.
Original Source: techcabal.com
