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Asia Pacific> Asia Weekly> Content
Monday, September 24, 2018, 12:32
Green drive by ride-hailing firms
By Robert Blain in Melbourne
Monday, September 24, 2018, 12:32 By Robert Blain in Melbourne

Good news for air quality as operators of huge fleets add to the momentum that is making electric cars people’s first choice

From left: Andre Soelistyo, president, Go-Jek; Jose Pontes, market analyst, EV-Volumes; Natasha Daly, marketing director, Ola Australia; Simon Moores, managing director, Benchmark Mineral Intelligence. (PHOTO PROVIDED TO CHINA DAILY)

As cars in China, the rest of Asia and across the globe turn increasingly electric, ride-hailing companies are also adopting a more environmentally friendly approach with their vehicles. 

One company at the forefront of this is Chinese ride-hailing giant Didi Chuxing, which is expanding its electric vehicle (EV) fleet as part of a significant green initiative.

“Hydrocarbon remains the world’s primary energy resource. However, Didi believes that ride-hailing will accelerate the spread of electric vehicles by making ownership more economical,” a Didi spokesperson told China Daily Asia Weekly.

“We are already the world’s largest EV fleet operator — 400,000 electric vehicles are now on Didi’s platform and the plan is to bring the number up to 1 million by 2020, which means saving 6 million tons of carbon emissions every year.”

From the end of 2017, the company has already started to invest in joint ventures to build EV-charging networks across China, the spokesperson added. 

Simon Moores, managing director of London-based Benchmark Mineral Intelligence, said: “We are not too far away from Uber and Didi having a significant number of electric vehicles in their fleet. Much like the mass consumer, these ride-sharing companies are waiting for the availability of pure 100 percent electric cars to increase.

“A major issue isn’t the cost anymore, but that many consumers just cannot get their hands on enough pure EVs in the right numbers. We believe 2019 is the year we will see a significant change in this circumstance,” Moores said.

With the knock-on effect of helping to reduce the global carbon footprint, this is also good news for the planet.

“If ride-sharing companies go all-electric, I think it will make a huge impact on the air quality of the world’s cities. Air pollution is not just an issue for China but major cities such as London. We have seen the first step of achieving low-emission cities with electric buses. China’s (carmaker) BYD has been a major factor in providing these solutions. The next step is ride-sharing,” Moores said.

“I think we are not that far away from governments completely banning combustion engine vehicles in some areas of our city centers. So, emission-free public transport will not just be a ‘nice to have’ but an absolute necessity.”

Moores added that ride-sharing companies that go all-electric earlier will have the “upper hand” and that Didi is well aware of this.

But other ride-hailing companies are also anticipating the benefits of developing a green fleet — both to the environment and also as a long-term boost to their bottom line. Indian ride-hailing company Ola, for example, is committed to creating a sustainable rideshare ecosystem for the future, with its Mission: Electric initiative. 

According to Natasha Daly, marketing director for Ola Australia, “(We have) a commitment to place 10,000 e-rickshaws and electric auto-rickshaws in service by April 2019. This milestone is in sync with the company’s plans to bring 1 million electric vehicles on Indian roads by 2021.”

This is undoubtedly good news for the air quality of major Indian cities such as Mumbai and the capital, New Delhi.

Indonesian ride-hailing company Go-Jek does not yet appear to be as advanced as some of its rivals in the region but nevertheless remains focused on exploring fossil-fuel-free vehicle options.

“As a world-class technology company, we will continue to innovate in a way that delivers sustainable, positive social impact to communities and businesses in the markets (in) which we operate,” said Go-Jek president Andre Soelistyo.

Jose Pontes, a market analyst at website EV-Volumes, is similarly upbeat about the future of EVs in the ride-hailing space, seeing it as the next logical step for the big players, notably Didi and Uber.

“BEVs (battery EVs) offer unmatched low running costs and the payoff increases the more you drive. Both Didi and Uber need to stay competitive with their cost per mile and BEVs get as low as you can go,” said Pontes. 

“Didi and Uber are likely to require, and to support, their owner-driver contracts to choose EVs. In cities with ICE (internal combustion engine) bans, they will become the only choice to offer rides. Both need to demonstrate sustainability.”

In July, in a related development, US electric car company Tesla announced a deal to open a new gigafactory in Shanghai — with the goal of producing 500,000 EVs a year.

Opinion is divided as to whether Tesla will team up with one of the major ride-sharing companies.

“Tesla is all about speeding up the adoption of all-electric mass transit. An ideal way to do this is by teaming with Uber or Didi to essentially shift the way we move around our cities to an all-electric, environmentally emission-free way,” said Moores.

“Tesla would no doubt jump at the chance to be a crucial component in cleaning up the air quality in China’s cities.”

However, Pontes was quick to scotch the possibility of a partnership between Tesla and Didi, saying such a deal was “unlikely”.

“Didi is reluctant to own their cars as it ties up much capital. Tesla is reluctant to (commit to) such fleet deals as they may compete with their own plans for a car-sharing/ride-hailing operation,” said Pontes.

It will be interesting to see how Tesla’s China adventure unfolds.


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