Transporters call for govt bailout as fuel expenses eat into earnings

Friday May 20 2022

Transport operators say they are incurring losses due to increasing fuel costs and now want the government to bail them out. Picture: File


Transport operators are pleading with the government for a bailout as revenues losses accumulate due to the current fuel prices.

Operators who spoke to Rwanda Today on condition of anonymity say they are stuck between a rock and a hard place because fuel prices are fixed despite rising fuel prices globally.

They say the recent slight increment in fuel prices doesn’t cover their operating fees. The Rwanda Utilities Regulatory Authority (RURA) raised the prices for petrol and diesel, citing the volatility in the global oil market.

The new prices, which took effect on April 4, saw the pump price for petrol increase to Rwf1,359 per litre from Rwf1,256. Diesel prices increased from 1,201 per litre to Rwf1,368. RURA reviews prices every two weeks.

Theonest Mwunguzi, chairman of Association Des Transporteurs Des Personnes Au Rwanda, an association of 26 companies, told Rwanda Today that the transporters need financial support because the government appears to be focused on giving support to passengers only.

Counting losses

One of the affected companies that operates at the Nyabugogo Taxi Park said they are incurring losses on several routes including upcountry.


"We used to travel Kigali to Rusizi at Rwf5,200 per seat and the diesel was Rwf860 a liter, and we were good at this time. Surprisingly, we're still charging the same cost but the diesel cost is now Rwf1,383," the transporter said.

He added that a full diesel-tank would Rwf75,000 and help make a net profit of Rwf60,000 for a trip from Kigali to Rusizi and back. But now, he says, the fuel cost exceeds the total amount of money from the passengers.

The companies claim the amount put in by the government to bring down the fuel cost is insufficient and want this increased regularly as well as revised fares.

"What we demand is financial support, and the cost that correlates with reviewed fuel costs or prices of the spare parts because they are now more costly compared to last year," the operator said.

Other costs rose as well. For example, the cost of insurance for half a year, rose from Rwf20,000 to Rwf40,000 for a car, as other costs like tap-and-go taxes and parking fees further ate into profits.

According to Horizon, a transport company that links Kigali with the southern provinces, it has been unfair to not see revised fare prices while the fuel cost increases every two months.

"The imbalance between the travel-cost and fuel cost affected us a lot financially," Bosco Tuyishime of Horizon, told Rwanda Today.