Uber’s boss makes the case for forcing companies into EVs

Companies don’t seem to want to talk about climate goals these days.

In the US, there’s political backlash against environmental initiatives and trepidation which way the election goes. In Europe, companies with ambitious emission goals are struggling with their core responsibility of profitability and staying competitive. In Asia, corporations continue to lag their western peers on setting sustainability targets.

Uber Technologies Inc. isn’t hushing — even though it finds itself among the laggards. The ride-hailing giant has seen its emissions rise dramatically, up nearly 60% between 2021 and 2023 as its business experiences rapid growth. But Uber Chief Executive Officer Dara Khosrowshahi is still talking climate. He sees the only route to managing both profitability and sustainability is to go electric.

“We certainly are leaning in with our own pocketbooks,” he said on the Zero podcast. “Our innovation is focused on making electric vehicles more delightful, available for everybody.”

About 10% of all miles driven in an Uber around the world are now in an electric car. And Khosrowshahi is proud that for one in four Uber customers, their first ever experience in an electric car happens while using the ride-hailing service.

Nowhere in the world is Uber doing better with its electric ambitions than London — where 30% of miles driven in its vehicles are zero-emission. The company used to charge customers a “clean air fee,” which was collected and used to subsidize the purchase of electric cars for Uber drivers. My random Uber Green ride on Thursday night happened to prove that point, with the driver saying he bought a Kia EV6 because Uber’s offer made it affordable.

All that doesn’t mean Uber is smashing its climate goals. Its emissions are rising faster than it’s electrifying the fleet. In London, it wanted all miles driven to be electric by 2025. That’s not going to happen, Khosrowshahi conceded. The goal is to reach 100% electric in all of Europe, US and Canada by 2030 — which he said is going to be a stretch.

The answer isn’t to give up on the targets, said Khosrowshahi. “Climate is a team sport,” he likes to say. And so the company is lobbying the European Union to increase the adoption of electric cars. It’s specifically pushing for more aggressive targets to electrify corporate fleets of vehicles and for making ride-hailing platforms run fully electric by 2030.

Stricter electrification targets wouldn’t just benefit Uber, but other companies with huge needs for moving goods, said Stef Cornelis, director of electric fleets at the non-profit Transport & Environment. “It’ll create a level playing field across the sector,” he added.

A Cambridge University report published in September backs up this point, arguing that corporate climate action will become less of a risk to profitability if some firms band together and push for government regulations that force all companies to meet climate goals.

These lobbying efforts, however, are potentially setting up a fight with other giant companies. German electric car sales have slumped this year and that’s spurred many of its automakers to ask the EU to reconsider its 2025 fleet-emissions targets . Carmakers across the bloc could face billions of euros in fines if they fail to meet them. One way the EU has responded is by putting tariffs on Chinese electric cars, which are often cheaper than their European counterparts.

Neither the tariffs nor the counter lobbying worries Uber’s Khosrowshahi very much. The company has signed a partnership agreement to get 100,000 electric cars from Chinese company BYD, which Khosrowshahi said could be on the road by 2030. If Europe and the US raise tariffs, he thinks the BYD electric cars will find a market in Asia and South America.

Growing an electric ride-hailing fleet is now core to Uber’s business model. “Our number one competitor is personal car ownership,” he said. “In the US, we want you to get rid of that second car and in many other places in the world, we want you to get rid of the car.”

Akshat Rathi writes the Zero newsletter, which examines the world’s race to cut planet-warming emissions. He is the author of Climate Capitalism .