Tata Motors will begin the EV deliveries to Uber fleet partners in a phased manner, starting this month.
Prabhjeet Singh, president of Uber India and South Asia, told ET that the agreement with Tata Motors is the biggest deal signed by any ride-hailing business in India. “This is the largest four-wheeler EV memorandum of understanding and this will likely catalyse further acceleration of the EV ecosystem,” he said.
The development comes amid increasing interest in the ride-hailing industry to convert its fleet into electric vehicles. Gurgaon-based all-electric cab company BluSmart is reportedly close to raising $250 million from various investors, and ET was the first to report about Uber’s rival Ola planning to deploy about 1,000 cars as a part of its Bengaluru EV cab pilot.
Partnership with fleet operators
Singh said that the electrification of its fleet will be a long-term process and the company will partner with operators like Mumbai-based Everest Fleets among others. This is different from its competitor BluSmart, which manages its own driver and fleets.
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By signing the deal with Tata Motors directly, Singh said that the company is “bringing different stakeholders together”.
Buying electric cars has been a challenge for small fleet companies as only a limited number of electric cars are manufactured in a year. The MoU with Tata Motors will help small fleet operators to buy electric cars more easily.
“If you look at the space right now, there are a very few individual fleet operators and Uber is coming in and creating access,” he said. “We are able to fast track access for these fleet operators in multiple cities and create a unified framework for fleets to work with Uber and for Tata Motors to work with Uber. The EV market is still nascent and large players with strong commitments and long-term views can add value.”
Unlike diesel cars, electric cars on ride-hailing platforms are not owned and operated by individual drivers as the high upfront costs and the downtime when the vehicle needs to be charged make it difficult for individual drivers to make money. A fleet operator buys and manages multiple cars and drivers.
Singh said that the San Francisco-headquartered Uber will work with fleet operators in multiple ways to build confidence around the economic viability of running electric vehicles on its platform . The company will provide clear visibility into demand patterns which will ensure as and when the vehicles get deployed they are able to hit economic breakeven much faster.
“We give confidence and clarity on where to put the vehicles, like multimodal hubs like the airports, which will then lead to higher utilisation,” he said. “We work with them to also make sure that there are deeper technology benefits which are very specific to EVs, for example, we are able to truly figure out over a period of time how the marketplace dispatch works in a way that reflects the range of the vehicle over a period of time.”
Singh said that the service would be a mix of planned and on-demand rides for customers and it will initially be available under Uber’s premium categories like Uber Premier, Reserve and Rentals. It might later list the EV cab service as a separate category once there are enough EVs in the fleet. Uber will make use of the algorithm it has developed in other markets where EVs have already been deployed, like the US, Europe and Latin America, but said that there will be country-specific tweets.
“We have the benefit of leveraging what is working globally not just in the US, in London, Europe and Latin America and combine them with a unique situation locally. We can expect a combination of the two being deployed,” he said. The company is already in talks with multiple EV charging companies in the country for using their network.
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