Electrification of ride hailing in India
In order to improve the country’s poor status of vehicle electrification, newly re-elected PM Modi’s government has announced that ride-hailers, such as Uber and Ola, need to convert 40% of their fleets into electric by 2026.
India’s EV registrations are amongst the lowest amongst large economies: less than 4,000 EVs were sold (period 03/2018 to 03/2019), versus 3.3 million diesel and petrol cars in the same period. Akin to China, India needs to ramp down fossil fuel consumption. Besides aiming to reach the Paris Climate Change Treaty objectives, India also wants to reduce its dependency on other countries for its energy supply.
Modi wants to create a mobility ecosystem that is “in sync with nature.” He adds: “My vision for the future of mobility in India is based on 7Cs: common, connected, convenient, congestion-free, charged, clean, and cutting-edge.”
Bad news for Uber
The US ride-hailer has been pulling away from Asia since its China operations were acquired by Didi and its South-East Asian services absorbed by Grab. Short after its IPO, it has also tried to sell off its Indian food delivery services to local competitors Swiggy and Zomato – without success.
Uber has no EV program in India, other than a small pilot it’s running with electric scooter company Yulu.
Good news for Ola
SoftBank backed Ola however has been running EV trials for 3 years. In addition, a USD 56 million spin-off “Ola Electric Mobility” was created to manage the company’s transition to electric. Ola will be activating 10,000 electric rickshaws by 2020 and wants to launch 1 million electric vehicles by 2021.
In March, Kia/Hyundai have added another USD 300 million to the spin-off in order to collaborate on mobility and electric solutions.
The Indian government wants ride-hailers to convert 2.5% of their fleets by 2021, 5% by 2022, 10% by 2023 and from there to 40% in 2026. The country has not been very successful in its previous campaigns for electric and seems now to pass the burden to its local mobility providers through regulations. It is unclear if any other advantages or subsidies will support Ola and Uber to electrify.