Inside Uber’s plan to switch entire car fleet to electric vehicles
By Sourced Externally
November 20, 2023
Australia’s millions of Uber passengers may have to get used to a new way to travel as the rideshare giant reveals a major change to how it works.
Uber is accelerating its push to have all its drivers adopt electric vehicles, as EV sales in Australia continue to soar.
Global Head of Sustainability Strategy at Uber, Chris Hook, said the recent growth in EV sales had convinced the company to put electrification high on its priority list.
Australian EV sales in the first ten months of this year are up 200 per cent on the same period last year. They now make up more than 7 per cent of new-car sales.
“A few years ago it wasn’t guaranteed we were going to go down this path but now it seems pretty locked in,” Mr Hook said.
He said it was “hard to predict” where the company would land over the next five-year period but added the car industry was scaling up EV production “quite quickly”, which would drive EV adoption.
Uber has pledged to be fully carbon emissions-free by 2040 and recently signed a deal with EV importer EVDirect to make more than 10,000 electric vehicles available to Australian Uber drivers at competitive rates.
Mr Hook said the shift to an EV-only fleet was not expected to have an impact on prices for passengers.
“This should be pretty effortless as a rider. In all the big cities in Australia you can now order an Uber Green (a low-emission ride option) and it’s the same price,” he said.
But the plan could meet resistance from drivers, who until now have baulked at the cost of EVs.
Mr Hook said the company would try to give incentives to drivers to make the switch from cheaper petrol and diesel vehicles “where we can”.
“We can’t fund the whole gap between an EV and a non-EV. Where we operate we have a whole bunch of programs set up to bridge that gap.”
In Victoria, where EV uptake has been slow, the company has introduced incentives to make the switch, including offering drivers a 50 per cent reduction in service fees, which could save as much as $3500 per financial year up until June 2025.
He said the price of EVs was also coming down, which would make the switch easier for drivers.
“An Uber driver isn’t someone who’s, generally speaking, buying a $70,000 new car, so the more and more models available that are at a reasonable price and are not premium, the easier it is for professional drivers to get hold of them, so we see that being a big contributing factor.”
Uber has said as it will not allow any petrol vehicles on the platform from 2040 and there will come a time, potentially before that, even, when petrol vehicles are are not allowed on the app.
Uber driver Sisir Barman, who drives a Camry hybrid, said he would consider an electric car in “maybe two or three years”.
“Right now I’m happy with the hybrid. I can save a lot of fuel with it and it’s environmentally friendly,” he said.
There were too many unknowns with electric vehicles, he said, including their range, battery reliability and price.
“If you want to buy a good electric vehicle it’s gonna cost you around $70 to $80,000. That’s pretty expensive.”
Mohammad Shehbaz, who owns a seven-seat Toyota Kluger hybrid, said range and size were issues, as he did a lot of long-haul airport drop-offs.
“For me, electric doesn’t work. I live in Gosford (on the NSW Central Coast) and I do a lot of regional driving. I also need to put a lot of luggage in the car,” he said.
He said there weren’t any suitably priced seven-seat EVs, which meant he couldn’t pick up Uber XL rides. XL rides are more profitable because they accommodate six people.
Despite the barriers, Uber says more than 1.2 million Uber rides were taken in an EV in the third quarter of this year, an average of 13,000 trips per day.
More than 2400 EVs operate on the platform.
“The goal is 100 per cent by 2040,” Mr Hook said.
“That’s the end point There are certain markets where we should be able to get there faster. That will be a lot depending on the economic makeup of those countries.”