Rideshare giant Uber UBER +3.2% is committing $800 million over the next five years to help its drivers switch from gasoline to electric vehicles by 2025 and promises to become a zero-emissions mobility platform in the decades to come.
In addition to the vehicle purchase assistance, which applies to drivers in the U.S., Canada and Europe, the company also plans to pay higher rates per trip to drivers who use battery-electric cars and hybrids and is arranging for discounted charging rates with major EV charging networks in the U.S. and Europe. The company says its goal is for all rides taken using its platform to be zero-emission by 2040.
“We're committing to work with cities to build back better together, tackle the climate crisis more aggressively than ever before,” CEO Dara Khosrowshahi said in a conference call Monday. “As our communities recover from COVID-19, we can rebuild them for people, not cars, we can add more green spaces and fewer parking spaces. We can envision a world where there are fewer fires, engulfing our homes, fewer hurricanes, displacing our neighbors, fewer natural disasters and cleaner air for everybody.”
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The company’s program comes as it and rival rideshare operator Lyft LYFT +3.9% draw more scrutiny for the impact the services have on local air pollution and congestion. In June, Lyft said it wanted all vehicles on its network to be electric by 2030, though at the time didn’t detail how much it planned to spend to make that happen. Uber’s program goes beyond EVs to include new initiatives to work with local transit agencies and expand micromobility options, including shared scooters and bikes.
Riders using Uber’s app will see an enhanced version of the Uber Green option to request low-emission vehicles, which include hybrids as well as battery-only models. To encourage more people to make that choice, they’ll receive triple the standard rate of reward points from Uber.
To incentive drivers, those registering qualified green vehicles on the platform will get an additional 50 cents per trip. Those using battery-powered cars receive an extra $1 for a total of $1.50 per trip, Anabel Diaz, Uber’s regional general manager for Europe and emerging markets said in the conference call.
Those higher fees are to help offset the added expense of EV purchases, and the company will also turn to “various market-based solutions, including a rider surcharge on Uber Green trips and fees collected from innovative programs like our London and French Clean Air Plans.”
Programs with automakers like GM will also help get more EVs in the Uber system. GM said Monday it’s offering Uber drivers GM Employee Discount pricing for purchases of new 2020 Chevrolet Bolt EVs. GM and Uber are also starting a pilot program in Los Angeles and Denver for Uber Diamond Drivers that includes discounted financing through GM Financial along with the corporate pricing offer.
“Improving access to EVs for on-demand service providers can help reduce overall tailpipe emissions in cities across the country and help accelerate widespread EV adoption,” said Sigal Cordeiro, GM executive director of Sales and Marketing for Global Innovation. “Our collaboration with Uber will facilitate drivers’ switch to an EV, empowering these drivers, their passengers and communities to experience electric vehicles and contribute to cleaner air in our cities.”
Transportation is the fastest growing source of climate-disrupting pollution and ride-hailing companies can help address that, Andrew Steer, president and CEO of the World Resources Institute, said in a statement. His group is partnering with Uber on its initiative. “As Uber increases its focus on low-carbon transportation, it can expand public transit integration and micromobility options, especially for low-income communities, and catalyze the electric vehicle revolution by supporting policies that prioritize the most intensively used vehicles first.”
Uber shares rose 3.3% to $34.32 in New York on Monday.
Date: Sep 9, 2020