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Green light: Beat, the ride-hailing company that’s taking on Uber in Latin America

The global ride-sharing market is growing fast, creating new opportunities for ride-hailing apps. Beat, which recently launched in Mexico City using electric Tesla cars, is betting the industry’s future is green.

Ride-hailing is stepping up a gear in cities around the world. In 2018, the global ride-sharing market, which includes ride-hailing, was valued at approximately US$61 billion, and is expected to reach US$218 billion by 2025, according to MarketsandMarkets1.

Many of the fastest growth spots in ride-hailing are in Latin America, which is home to some of the most urbanised cities in the world.

Many of Latin America’s largest cities, such as São Paulo, Mexico City and Bogota, have limited public transport infrastructure which can struggle to cope with peak demand during the morning commute. That, combined with some of the world’s worst traffic congestion – drivers in Mexico City spend an average of 195 hours per year in rush-hour traffic – can make commuting uncomfortable and stressful2.

In Latin America, and around the world, there is growing demand for efficient and environmentally sustainable forms of urban transport. New modes of transport such as ride-hailing services are becoming more common.

There is an obvious gap in the market for a green ride-hailing service. The potential environmental and emission-reduction benefits of replacing a traditional ride-hailing car with an electric one are threefold, according to a study by the Institute of Transportation Studies at the University of California, Davis3.

Electric ride-hailing vehicles, powered by a ‘clean’ energy grid, will be important in “reducing the potential adverse environmental impacts of these services”, says Adam Cohen, researcher at the Institute of Transportation Studies at the University of California, Berkeley.

In October 2020, Beat, the fastest-growing ride-hailing app in Latin America, launched a ride-hailing service in Mexico City, using a fleet of 130-plus Tesla electric cars.

The premium service, called Beat Tesla, is roughly twice as expensive as a regular ride-sharing car4. The cars provide rides in Mexico City every 15 minutes and demand for the service has increased by approximately 35 per cent week on week since it started, according to Beat.

After a customer places an order through the Beat app, a car is dispatched within a few minutes. An in-car navigation system guides the drivers to pick-up and drop-off locations. Unlike some competitors, Beat Tesla’s drivers are employees, rather than self-employed workers – the drivers are employed by a third-party company that also owns the cars they drive.

“We wanted to help cities evolve and become greener,” says Sanja Ilic, Chief Operations Officer at Beat, part of the FREE NOW group, the ride-hailing joint venture of BMW and Daimler.

“Traffic congestion and pollution in Mexico City are among the worst in the world. It was important for us to be a first mover in sustainable ride hailing.”

Beat built two charging hubs in Mexico City, which can charge its car batteries within one to two hours. The cars are maintained in a separate facility.

“Customer feedback for Beat Tesla has been excellent,” says llic. Beat is considering introducing electric ride-hailing services in other Latin American countries including Chile, Peru, Colombia and Argentina.

To ensure passenger safety during the Covid-19 pandemic, drivers take a health screening before every shift, including a check of their temperature and oxygen saturation level.

As electric vehicle technology matures, the cost of the cars and batteries that power them are expected to fall significantly, helping Beat offer electric car-hailing services at lower prices.

In the long-term, Beat plans to embrace technological advances even further by powering its fleet with autonomous cars and controlling the rides remotely, resulting in even more affordable prices for their dedicated customers.

The Covid-19 crisis may have brought about some challenges for the global ride-sharing market, but with growth set to rebound5, Beat Tesla is determined to drive ride-hailing to a sustainable future.

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