In his State of the City address earlier this year, the Mayor of New York City declared that all ride-hailing vehicles in the city will be required to be zero-emissions by 2030. This will mean that around 100,000 ride-hailing vehicles will be zero-emission by the end of the decade.

This, in many ways, reflects the convergence of two major trends in the mobility industry: shared and electric. Worldwide, automakers are turning to electrification in a bid to ensure regulatory compliance and push the mobility industry towards more sustainable, low-emission alternatives.  On the other hand, positive regulations (much like in New York City), incentives, and subsidies, paralleled by advances in technology and charging infrastructure, have reinforced the business case for the electrification of shared mobility fleets.

To learn more, please access our research reports, Electrification Strategies of Shared Mobility Operators, European Shared Mobility Growth Opportunities, Global Autonomous Shared Mobility Growth Opportunities, Indian Shared Mobility Growth Opportunities,  or contact sathyanarayanak@frost.com for information on a private briefing.

Electric Shared Mobility is Picking up Momentum

From car sharing and bike sharing to ride-hailing and demand responsive transit (DRT), electric vehicles (EVs) are coming to the fore. Frost & Sullivan research underlines that the electric shared mobility fleet size will expand from an estimated 3.6 million vehicles in 2021 to 10.5 million by 2030.

Among the multiple drivers supporting market growth, three of the most crucial are favorable legislation, the need to cap transport-related carbon emissions, and improved economics.

Several countries today offer subsidies for the purchase and installation of electric vehicle supply equipment (EVSE). This, together with rebated electricity costs for EV charging, is spurring fleet electrification by shared mobility operators. In contrast, fuel prices continue to climb upwards.

Cities are transitioning towards sustainability through the development of ultra-low emission zones, fewer parking spaces, car-free zones, and decarbonized public transport. Meanwhile, electric shared mobility modes are also finding a niche in fulfilling first-and last-mile connectivity needs.

Consistently falling costs of EVs and EVSEs, reducing price gap with ICE vehicles, fuel and maintenance savings, and government rebates will translate to lower total cost of ownership eventually, making EV fleets an economically viable option as well in the future.

That said, lengthy return-on-investment periods, continued concerns over range anxiety, and inadequate charging infrastructure will all contribute to the slow pace of transition to shared electric fleets. The current cost of EVs is high with a long return on investment period which makes the transition from ICEs difficult in asset-heavy shared models and equally in asset light models like ride-hailing where the cost is ultimately borne by drivers.

Regional Variations in Uptake

Frost & Sullivan projects rapid growth of electric shared mobility in Europe and North America, both of which have a favorable regulatory and financial climate.  The general lack of supporting infrastructure in the region means that China and South Korea will be the exceptions in an otherwise desultory market for electric shared mobility in Asia Pacific (APAC).  China is a standout in terms of adoption of electric vehicles be it for car sharing, ride-hailing, or bike sharing. The pace of adoption of electric shared mobility will lag across Latin America, the Middle East, and Africa.

Underscoring its growth potential, every sphere of electric shared mobility is seeing intense competition.  Car sharing has Free2Move, Blink Mobility, WeShare, Zity, Hoppygo, Green Mobility, and MOL Limo, among others. Ride-hailing has Uber, Lyft, Gojek, Grab, Ola and Blu Smart Mobility. Participants in bike sharing include Tier Mobility, Citi Bike, Hello Bike, Qingju Bikes, and Lime, while DRT has Moia, ViaVan, Zeelo, Swvl, and others.

Future Scenarios

Our research indicates that by 2030, EVs will constitute more than a 50% share of the shared mobility market in North America, with ride-hailing accounting for the largest proportion. At this point, electric powertrains will also power more than half of the car sharing vehicles in operation.

Currently, the overall penetration of electric bike (eBike) sharing is low because of the presence of alternate micromobility modes, such as kick scooters that are more cost-effective and have better economies of scale. However, going forward, eBike sharing will account for 50% of fleets in Europe and North America by 2030.

Ride-hailing companies are targeting 100% fleet electrification by 2030. However, the shift has been slow in cases where drivers, rather than aggregators, own the fleet.  This is related to high initial costs and the inability for drivers to install home charging. Meanwhile, taxi fleets in certain European cities are transitioning more rapidly due to stringent, government mandated regulations.

The fastest transition will be in the public transport segment where DRT will leverage AI to maximize on fleet utilization. Governments will spur the shift to electric buses, with financial support and regulatory impetus. While the transition to electric DRT will be slower in emerging markets like India, Brazil, and South Africa, it will much faster in Europe where, impelled by regulatory targets, 45% of DRT is expected to be electric by 2030.

With inputs from Amrita Shetty, Senior Manager, Communications & Content – Mobility

About Chanchal Jetha

Chanchal Jetha, a Senior Research Analyst with Frost & Sullivan's Mobility Practice, has five years of market research and consulting experience in technology and automotive research. She was part of the team that developed Frost & Sullivan's Innovation Generator Platform for the New Mobility Segment.

Chanchal Jetha

Chanchal Jetha, a Senior Research Analyst with Frost & Sullivan's Mobility Practice, has five years of market research and consulting experience in technology and automotive research. She was part of the team that developed Frost & Sullivan's Innovation Generator Platform for the New Mobility Segment.

Amrita Shetty

Amrita Shetty is Communications & Content Senior Manager within Frost & Sullivan's Mobility practice.

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