Friday, June 23, 2006

Matatu Fare Increase - Part II

My earlier calculations are apparently correct as regards to the new fare.. ( i think):


5.2% increase in fuel price is correct.

Assuming that

it costs 100 KES in fuel to travel from suburb A to City Centre (probably much cheaper) - prob about 15 km.

an average of 10 passengers travel in this vehicle (usually maaaaaany more).

the fare is 30 bob.

Means the cost incurred per customer / per trip is 10 bob

Profit less other expenses is 20 bob.

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Increase fuel by 5.2% means it costs KES 105.2 in fuel for the same journey

cost incurred per customer / per trip is 10.52 bob

Increase in cost incurred 10.52 - 10.00 = 0.52 bob -> translates to 5.2%

So my earlier calculations are infact correct.

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Bottom line:

Some ma3 owners are now increasing fares by up to 20 bob.

the MWA says fares should not go up by more than 15%. with a minimum of 5 bob and max of 10 bob.

I suggest they stop using the fuel increase as an excuse for increasing fares and look for another way of justifying it

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1 comment:

ip said...

the fare raise should 5.2% of 30 bob
which is 1.56 so the fare should only rise by max 2 shillings if u round off

do the math! remember primary maths(we called it sums) if A - B costs 100 shiling for one person. how much would it cost if two people shared the cost?
what about three and how much would each have to pay if the price went up by 5%

so for the Matatu association to say the price should go up by 5 bob thats a 10% rise fifteen bob is
is like a 30% climb