Volkswagen has won a tender to operate at the Kigali International Airport, marking a new lucrative market for the Germany automaker’s taxi hailing service provider.

The category 1 tender, which is meant for providing transport service to VIPs was won alongside Airport Taxi Drivers Association (ATAK) who have been the only player operating at the airport.

“We have always wanted to operate at the airport as it has been top on our priority areas of operation, we just had to wait for the right opportunity.”

“Now that we won the category 1 tender, which is VIP transportation, we are going to use our other range of vehicles like the Terramont, Passat and Tiguana’s, which will soon be added onto our platform,” said Nadeje Gaju, Volkswagen head of sales and marketing.

Ms Gaju said they had a competitive edge in the tender because of innovative product which includes a ride hailing app and fair pricing. “We want to also introduce the e-golf vehicle to the airport, to serve customers who are sensitive to carbon emissions.

It’s an exciting target market, and we want to focus more on the elements of quality, comfort and safety,” she said. However, amid increasing competition from Volkswagen, many members of ATAK are disgruntled as some claim to have secured bank loans to upgrade their vehicles according to the requirement of the airport.

“They have already deployed more than 50 move cars at the airport… It will be hard to compete with them, but we have to co-exist,” said one ATAK driver on condition of anonymity because they are not authorised to speak for the association.

Volkswagen, and its ride hailing offshoot, Move has come under criticism from other players in the market, faulting the regulator for giving it a green light to compete unfairly, through setting lower tariffs which give them an advantage over other players like Yego cabs.

While other car-hailing services charge Rwf1,500 for the first kilometer and Rwf700 for the next kilometres, Move charges Rwf600 for the first kilometer and Rwf730 for the next. This means that for a five-kilometre journey that costs Rwf4,250 with VW cabs, other taxi hailing companies such as Yego will charge Rwf5,000.

The difference in pricing, which is set by Rwanda Utilities and Regulatory Authority (Rura), has disrupted the business and given Volkswagen a competitive edge over its competitors.

However, Rura maintains that the current taxi tariffs consist of a minimum of Rwf500 per kilometer and maximum Rwf778 per kilometre.

Yego taxi tariff structure is fixed at Rwf1, 500 for the first kilometer and all subsequent kilometres at Rwf700 each, and Rwf500 for each kilometer beyond 30 kilometres.

“Yego tariff is purely based on distance while the VW tariff structure is a combination of both distance and time, meaning a charge per distance plus a cost per minute of driving ,” Patrick Nyirishema, director general of Rura told Rwanda Today.

“The difference is based on a partnership between VW and the government, which seeks to bring new mobility solutions to the country such as the introduction of electric vehicles. We accommodated them with that thinking in mind.” Mr Nyirishema added.