As Uber races to deliver on its promise to have “100 percent” of rides powered by electric vehicles by 2030, Uber is offering $4,000 grants to drivers to trade in their gas-powered vehicles for zero-emission vehicles. The company is also dropping the “Uber Green” branding in favor of the simpler “Uber Electric.”
Uber said it will fully carbon neutral in North America and Europe by 2030 and in all global markets by 2040. But when the company first announced this promise in 2020, it said it would not directly pay drivers to ditch their gas-powered vehicles for electric vehicles. Now the company is reversing that decision in hopes that direct payments will help speed up the adoption of electric vehicles.
The reason for the switch isn't all that surprising. The recent expiration of the US $7,500 federal electric vehicle tax credit is expected to deal a major blow to EV sales, making it harder for Uber drivers to make the switch while keeping their costs level. Uber's new offer aims to soften the blow for many drivers who have relied on credit for both used and new electric vehicles.
Not every driver will be eligible for grants, at least not initially. Under Uber's new “Go Electric” program, drivers in New York, California, Colorado and Massachusetts can apply to receive $4,000 when upgrading to a new or used electric vehicle. Combined with local incentives such as Massachusetts MOR-EV And Colorado Clean Fleet ProgramEV prices could fall further.
Uber notes that the $4,000 amount was equal to the recently expired federal tax credit for used electric vehicles. With Go Electric, Uber hopes to make up for the loss of the tax credit by investing its own money in purchasing electric vehicles.
It's been a rocky road for Uber in its quest to eliminate gas guzzlers from its platform. During the boom of electric vehicles in 2021, rental company Hertz announced the acquisition 100,000 Tesla And 65,000 Polariswith the goal of renting some of them out to taxi drivers. But high rates of depreciation led Hertz will cancel deals and sell most of its electric vehicles it has already acquired.
Uber notes that the $4,000 amount was the same as the recently expired federal tax credit for used electric vehicles.
But Uber fulfilled its obligations to attract more electric vehicle drivers. Last year, the company announced a partnership with Chinese auto giant BYD to bring 100,000 electric vehicles to drivers in Europe and Latin America. According to the company, Uber currently employs 200,000 electric vehicle drivers worldwide.
Of course, getting hundreds of thousands of people who drive Uber to switch to electric cars. it won't be an easy task. Ride-hailing drivers are classified as independent contractors, and many use their personal vehicles to work for more than one gig economy company. Uber can't simply force all of its drivers to move on to other jobs without jeopardizing their status as freelancers. Additionally, electric vehicles tend to be more expensive than gasoline-powered vehicles, despite lower refueling and maintenance costs. These high upfront costs can be a problem for many drivers who typically operate on incredibly tight margins.
Earlier this year, Uber said Uber Green, the company's electric and hybrid vehicle transportation product, would become an EV-only feature. Previously, Uber Green offered both electric and hybrid cars, offering an additional ride fee (usually $1) to drivers who used any vehicle with less tailpipe pollution. Now under the Uber Electric brand, the company is offering drivers discounts of 20 percent or up to $8 on electric vehicle rides with the code GOELECTRIC20. (Offer valid for seven days.)
Uber is also expanding its battery data matching feature to more EV brands. The feature filters ride requests based on the EV's battery level, so drivers can accept rides that end near a charger or avoid rides that are too long for their battery. The feature is currently launching in 25 countries in the US, Canada and Europe. And it will now support electric vehicles from Kia, Hyundai, Ford, Nissan, Volkswagen and Mercedes-Benz.
