Uber is accelerating its electric vehicle transformation plan. To achieve its promise of 100% electric vehicle trips by 2030, the company is offering drivers a $4,000 subsidy to encourage them to switch from gasoline-powered cars to electric vehicles.
Uber had stated that it would achieve full carbon neutrality in North America and Europe by 2030, and in all markets globally by 2040. At the time, the company said it would not directly pay drivers to switch from gasoline-powered cars to electric vehicles. However, Uber has now reversed this decision.
The reason Uber is subsidizing its drivers may be due to the US federal government's termination of the electric vehicle tax credit. Industry insiders predict that the end of this policy will significantly increase US consumer spending on electric vehicles, thereby drastically reducing electric vehicle sales.
For Uber drivers, the end of the tax credit means it will be difficult to switch to electric vehicles while controlling costs, but Uber's $4,000 subsidy will greatly improve their situation.
A drop in the ocean?
Uber's "Go Electric" program initially offers a $4,000 subsidy to drivers in high-demand areas such as New York City, California, Colorado, and Massachusetts, while drivers in other states can apply for a $1,000 subsidy. Uber points out that the $4,000 subsidy is the same as the federal tax credit for used electric vehicles in the United States.
Uber has been pushing for its platform's drivers to use electric vehicles. Last year, the company announced a partnership with Chinese automaker BYD. Through this partnership, 100,000 electric vehicles have been deployed in Europe and Latin America. Uber also stated that there are currently 200,000 electric vehicle drivers on its global platform.
Nevertheless, there are still some challenges in getting ride-hailing drivers in the United States to use electric vehicles. While electric vehicles are more economical in terms of energy and maintenance costs compared to gasoline-powered cars, their price is usually higher, making them unaffordable for many drivers with low profit margins.
Uber's incentives may provide a limited boost to demand in the U.S. electric vehicle market. The industry consensus is that after a booming third quarter, the U.S. electric vehicle market will experience several quarters of weakness as the tax credit expires.
However, Uber also pointed out that the industry needs to take more action and strengthen cooperation, because climate action is a collective endeavor. Uber cannot achieve zero emissions alone, but it is doing its best.
(Article source: CLS)
