The Matatu Owners Association (MOA) has warned that public transport fares could rise following the latest fuel price increase.
According to MOA President Albert Karakacha, operators can no longer absorb the additional costs, warning that the burden would be passed on to commuters.
“We are businessmen; we will pass it on to the consumer. We cannot be the ones cushioning the expenses while making losses. We are making the common Mwananchi cushion the expenses and that is not right, but we have been pushed to the wall. The public should come out and ask for answers,” he said.
Karakacha said the fuel price increase came amid rising vehicle maintenance costs, insurance premiums and spare parts, further squeezing operators already struggling to meet their expenses.
He said a tyre that previously cost Sh25,000 now retails at between Sh38,000 and Sh45,000, while comprehensive insurance premiums have risen from Sh180,000 to Sh250,000.
“The price of a single tire, which used to cost Sh25,000, is now going for Sh38,000 to Sh45,000. Insurance premiums have gone up by over 30 per cent. A comprehensive cover that was Sh180,000 is now Sh250,000. Spare parts, everything has gone up,” he said.
He warned that rising operating costs could also make it harder for operators financing vehicle purchases through bank loans to meet their repayments, while reduced consumer spending could hurt businesses across the economy.
“Our economy will shrink. When fuel goes up, people travel less, people buy less, businesses make less. Shops will sell less. The mama mboga will have fewer customers. And for us, loans in the banks will become a nightmare,” Karakacha said.
His remarks come a day after the Energy and Petroleum Regulatory Authority (EPRA) announced increases of Sh12.93 per litre for Super Petrol and Sh28.49 per litre for kerosene. The diesel price increase also comes weeks after President William Ruto assured transport sector stakeholders that diesel prices would not rise.
Karakacha said the latest increase contradicted the assurance given to operators during their meeting with the President.
“We sat with him as transport sector stakeholders. He assured us that diesel, which is the backbone of public transport, would be protected from arbitrary increases. Today, diesel is up by Sh9.90 per litre. That promise has been broken. What are we supposed to tell our members?” he said.
The MOA president called on the government to cushion operators and consumers against rising fuel costs, proposing the reintroduction of fuel subsidies or the establishment of a stabilisation fund.
He also called for the removal of taxes he described as punitive, citing Ethiopia as an example of a country that had taken measures to reduce the tax burden on imported fuel products.
“We want Kenya to borrow a leaf from Ethiopia. Ethiopia has banned tax on imported fuel products. That is why their economy is growing. If Ethiopia can do it, Kenya can do it. The Government should remove these punitive taxes on fuel,” he said.
Karakacha said the association would convene an urgent meeting to agree on a unified response to the new fuel prices.
“We will meet as an association and come up with a unified position. But one thing is clear: we cannot absorb this increase. The consumer will have to bear the cost,” he said.
