Uber will stop using diesel cars in the UK capital within two years so the majority of its rides are in electric or hybrid vehicles.

The ride hailing company said currently around half of all the journey miles completed in London are undertaken with greener vehicles on its standard low-cost UberX service which lets customers book journeys on their smartphone.

Uber, which has about 40,000 London drivers, said it would only offer electric or hybrid models on UberX by the turn of the decade and plans to do the same by 2022 nationwide.

It added it would help its drivers who want to switch to greener cars via a GBP150m (US$197m) fund, paying up to GBP5,000 ($6,600) per upgrade from a petrol or diesel vehicle.

It was reported last month Daimler and BMW were rumoured to be in talks to combine their car sharing services Car2Go and DriveNow.

The two carmakers were said to have discussed pooling their car sharing businesses to better compete against ride hailing companies like Uber and Lyft which have started offering pay per use mobility services which are more convenient than car ownership.