Radar | Dec 08,2024
A row of blue-and-white Lada taxis parked on Ras Mekonnen Avenue, near Addis Abeba’s Stadium, awaited passengers last week, their faded paint and battered frames a reminder of another era.
Once symbols of the city’s jammed streets, these Soviet-era cars, mainly the VAZ-2101, dominated the taxi fleet from the 1970s onward. Songs and stories celebrated them, but those days are gone. Now, the Lada tells a different story of survival and broken promises.
Inside one taxi, the driver’s seat was propped up with cobblestones beneath a torn cover. The passenger seat, tied down with a rope, missed fittings. The driver, exhausted and frustrated, gestured at his shoes, patched and wrapped with cloth after years of wear. He kept blood pressure documents and eye medication on hand, ready to show police as proof of his medical needs. For him, every detail of daily life, down to keeping his shoes together, mirrored a struggle to support his family.
Across the city in Qera, more Ladas lined the curb outside a mosque, some with spare parts stacked inside. Drivers gathered to swap stories and commiserate, their voices rising over the noise of traffic. At Wello Sefer on Ethio-China Street, the cars look better kept, but work remained scarce, and uncertainty loomed.
Will there be passengers at all?
Some drivers shy away from discussing their predicament.
“Don’t touch our wounds,” one said, declining to give his name.
Others speak quietly, fearing trouble. More than 10,000 Lada owners have lived this way for six years, caught between escalating costs and unfulfilled government pledges.
There are 1.6 million registered vehicles on the country's roads, for a population of more than 100 million, resulting in a vast supply gap. Banking is challenging because vehicles carry high risk and have little resale value.
Four years ago, Mayor Adanech Abiebie and her Deputy, Jantirar Abay, announced a plan to replace old Ladas with new vehicles, requiring drivers to pay part of the cost up front. The Ministry of Finance, under Ahmed Shide, and the Prime Minister's Office lent support, with former Transport Minister Dagmawit Moges among those promising to deliver a new fleet of vechiles imported from China.
Seifu Amanuel, a veteran driver parked at Wello Sefer, has spent 18 years behind the wheel. Once an army soldier under Mengistu Hailemariam (Col.) and later a nightclub bouncer, Seifu now lives in Bole Bulbula. If it were not for family support, he would have found it too difficult to cover his monthly rent of 12,000 Br.
“Although there is a law, when gaps are created, nothing changes,” he said. “My situation will not improve, and I can't replace my car.”
Seifu bought his first 4K-type Lada for 30,000 Br. Today, he would need 130,000 Br for a replacement, a sum far beyond his means.
“The system has lost its core purpose,” he said.
Maintenance costs are up sharply. Repairs that once cost 200 Br now run over 2,000 Br. Spare parts are hard to find and expensive, often taken from wrecks at Mercato's Somali Tera quarter. Seifu recently paid over 18,000 Br for repairs, a sum that “messed up my pocket.” He often returns home empty-handed after a day on the streets. On good days, he might make 1,000 Br, barely covering fuel.
“Sometimes, when I think about my life, I go deep into darkness,” he said. “Then, I come back to my senses and ask myself why I'm thinking like this.”
Seifu recalled a tree-planting initiative with then-Mayor Takele Uma, when drivers were promised new vehicles. But as the city changed administrations, those agreements faded.
Like Seifu, thousands of Lada owners have paid 130,000 Br toward the promised replacement vehicles, but new cars remain out of reach. In six years, particularly so after the exchange market liberalisation, the cost to the vechiles thought to have come from overseas has ballooned.
The replacement program was meant to be managed by El Auto Engineering & Trading Plc, part of Elnet Investment Holding Group, which also operates Taxi Ride. The company, led by Tokkicha Alemayehu, assembles public transport vehicles. But Seifu recalled a process marred by delay and confusion.
“There are no consistent procedures, and that delays everything,” he said.
To cover expenses, he took a 50,000 Br loan from Elsabi Microfinance, another Elnet company, but learned he would need an additional half a million Birr to secure a new vehicle, a sum he cannot afford. Some drivers have waited six months or more for new cars that never come.
“There are some organisations and individuals untouchable by the law,” Seifu said. “The government has to address our issue.”
According to several drivers, officials at the Addis Abeba Transport Bureau are well aware of their stories.
According to its head, Yabibal Addis, the Bureau helped drivers with loan access and duty-free paperwork but did not control delivery. After agreements were signed, drivers negotiated directly with importers. Policy changes later forced drivers to pay companies up front, and the loss of duty-free status made matters worse.
Solomon Assefa, a driver working around Wello Sefer, paid 130,000 Br as a down payment on a new seven-seater taxi, with the remaining amount to be financed through a loan from the Commercial Bank of Ethiopia (CBE). He recalled feeling assured that the sales contract stated the vechiles would be delivered in three months.
“Four years on, and still nothing,” he told Fortune. “We kept waiting, counting the days.”
The initiative started under former Mayor Takele to phase out old Ladas. El Auto won the contract, although it could import cars with foreign currency access. Lada owners were organised into associations, but only a handful have received new vehicles.
Solomon was not one of these "lucky" Lada owners. Yet, his earnings have shrunk. On a good day, he brings home 1,000 Br to 2,000 Br; on a bad day, nothing. His monthly house rent of 9,000 Br takes much of his income, and he still supports a family.
“We don’t even have money for maintenance,” he said. “We need to eat and survive first. Technology is changing the way we work, but our cars are old. Customers don’t trust us anymore.”
The cost of alternatives has soared. A Toyota Vitz once cost 350,000 Br but is now 1.3 million Br. Solomon wondered why the government did not allow the import of 10,000 vehicles at once. But duty-free promises went unfulfilled, and nothing has changed.
“If they brought many cars together, we could have gotten them quickly and affordably,” he said. “Now I've no hope. I'll drive this car until it dies.”
Over 10,500 taxi owners signed up to replace their cars after the agreement with El Auto was signed in November 2020. More than 8,000 paid 130,000 Br and completed the paperwork. According to El Auto’s Communications Director, Isayas Tafesse, about 3,000 vehicles have been delivered. He blamed financing issues and logistical challenges, including assembly and transport from Dire Dawa to Addis Abeba, for stalled progress.
Close to 540 vehicles have sat undelivered for a year due to policy changes, where federal transport authorities banned the importation of non-electric vehicles, and 800 more remain on hold due to financial issues. Duty-free import privileges were revoked in the meantime, further raising costs. Isayas, who spent five years at the Ethiopian Football Federation and four years at Ethiopia Buna Sports Club before joining El Auto, disclosed a plan to import over 500 vehicles a month, but exchange-rate swings have pushed prices even higher. After duty-free status was removed, the vehicles' prices climbed to 2.4 million Br.
Duty-free privileges were sporadically granted and withdrawn between 2021 and 2025, adding to the confusion. In 2023, Finance Minister Ahmed Shide repealed duty exemptions for taxis with no explanation. However, his Ministry allowed some companies, including Hello Taxi and O’Clock Taxi, to import 10,500 taxis. But disputes over duty-free rules led to further delays. Police recently arrested Hello Taxi executives for alleged embezzlement after 127 taxi owners paid between 130,000 Br and 540,000 Br each.
Customs Deputy Commissioner Muluwerk Deresse requested clarification on the current duty-free status in February 2025. Meanwhile, some owners returned plate numbers as required for eligibility, losing the ability to operate taxis. With jobs gone, hope remains their only sustenance.
Isayas partially blamed drivers for "refusing the delivery of cars despite repeated announcements" through 205 associations. Financial intermediaries were often required, and some contractual arrangements stalled. CBE was initially the primary financial partner. Other banks, including the Bank of Abyssinia, have recently engaged to provide financing.
Depreciation and policy changes, including a push for electric and gas-powered vehicles, have left taxi owners in limbo.
One such foundered owner is Abraham Tilaw, a long-time driver, who owns his house but still feels the strain. He paid 130,000 Br for a six-seat car but never received it.
"Now everything is expensive," he told Fortune. "My car requires constant repairs."
Most vehicles are Roewe i5 models, internationally priced between 9,710 dollars and 16,340 dollars. Delivery delays are due to duty-free access issues and unmet driver requirements. Vehicles were sold directly, placing financial risk on buyers. Officials from the ministries of Finance, Revenue, and Industry rejected the retroactive application of laws.
Experts in the transport sector view the associations and their members as victims of an unstable policy, citing recent shifts toward electric and natural gas vehicles.
“Replacing old vehicles is essential for carbon reduction,” said Abiy Alene, a transport expert at Kotebe Metropolitan University. “But government support for associations must be unwavering.”
He points to Uganda and other African countries that have replaced old cars to fight pollution, while Ethiopia’s streets are jammed by imported used vehicles.
Abiy urged greater domestic assembly of vehicles and more careful imports to reduce costs and pollution.
“Policy should be the voice of the people, not government interests,” he said.
PUBLISHED ON
Jan 10,2026 [ VOL
26 , NO
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