Shares of London-based electric automaker Arrival surged as much as 10% on Tuesday after the company said it will partner with Uber to develop a vehicle for ride-hailing drivers.
No financial terms of the agreement were disclosed. Uber in 2020 said it’s aiming for its London-based service to feature all electric vehicles by 2025.
Despite Tuesday’s surge, Arrival’s stock is still down roughly 32% in 2021, although it is now up 97% over the past 12 months. Uber slid 2%.
Arrival said Uber drivers will be part of the process of designing the Arrival Car to ensure it meets their needs and those of its passengers. The company said it foresees revealing the final design before the end of 2021 and production to begin in the third quarter of 2023.
A typical ride-hailing vehicle is driven, on average, for 45,000 kilometers to 50,000 kilometers a year compared with 12,000 kilometers for a typical vehicle, said Arrival. Uber said it has raised more than £135 million ($189 million) to support drivers with the cost of switching to a fully electric vehicle.
“Our focus is now on encouraging drivers to use this money to help them upgrade to an electric vehicle, and our partnership with Arrival will help us achieve this goal,” said Jamie Heywood, Uber’s regional general manager for Northern and Eastern Europe, in a statement.
Uber has also said wants its platform to have all electric vehicles by 2030 across Europe and North America.