Didi Chuxing

Didi Chuxing
滴滴出行

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Formerly called	Didi Kuaidi (Feb 2015–Sept 2015) Didi Dache, Kuaidi Dache (pre-Feb 2015)
Type	Privately held company
Founded	June 2012 (June 2012)
Founders	Cheng Wei (程维) Zhang Bo (张博) Wu Rui (吴睿)
Headquarters	Beijing, China
Area served	Mainland China
Key people	Cheng Wei (CEO) Zhang Bo (CTO) Liu Qing (柳青) (President)
Services	Vehicles for hire
Website	www.xiaojukeji.com

Didi Chuxing
Chinese	滴滴出行
Transcriptions Standard Mandarin Hanyu Pinyin Dīdī Chūxíng
Former name
Chinese	滴滴快的
Transcriptions Standard Mandarin Hanyu Pinyin Dīdī Kuàidī

Didi Chuxing (Chinese: 滴滴出行, pronounced [tɨ́tɨ́ ʈʂʰúɕɪ̌ŋ]; English pronunciation: /ˌdiːdi ˌtʃuːˈʃɪŋ/), formerly Didi Kuaidi (Chinese: 滴滴快的), is a Chinese transportation network company headquartered in Beijing. It provides vehicles and taxis for hire in China via smartphone applications. Formed from the merger of rival firms Didi Dache and Kuaidi Dache (backed by the two largest Chinese Internet companies, Tencent and Alibaba respectively), it is valued (as of February 2016) at approximately US$20 billion.

History

The company is the result of the February 2015 merger between taxi-hailing firms Didi Dache (backed by Chinese Internet giant Tencent Holdings Limited) and Kuaidi Dache, backed by Alibaba Group (one of the largest e-commerce firms in the world). A study in December 2013 by Analysis International, cited by Reuters, estimated Didi to hold approximately 55% of the smartphone-based taxi-hailing market (estimated to be used by 150 million people), with Kuaidi holding nearly all of the rest. However, a protracted price war in an effort to gain market share had resulted in mounting losses for the two companies, despite Didi and Kuaidi raising US$700 million and US$600 million from private investors, respectively, to sustain their growth in the world's largest transport market.

As of May 2015, Didi Chuxing was to spend another CNY1 billion (US$161 million) on aggressive promotions and advertising in order to consolidate its dominant position against startups such as Yidao Yongche (Chinese: 易到用车) and Uber (who has Baidu, the third-largest Chinese Internet company, as an investor). This included adding other features alongside its basic taxi-calling function such as the ability to carpool, hire premium cars, hire designated drivers and use a special service for passengers with disabilities. Caixin reported that in June 2015 the company had a market share in car hire service of 80.2%. By September 2015, the company had a market share in private cars of 80% and in taxis of 99%.

Around the start of 2016, the company was engaged in a fierce price war with American rival Uber, which started operations in China in 2015. The competition with Uber (currently operating in 40 Chinese cities and planning to expand to 100 by the end of 2016) has led to Uber's CEO Travis Kalanick to claim the company is losing over US$1 billion annually on its Chinese operations, despite their local unit being valued at around US$8 billion after a recent billion-dollar fundraising round. This was confirmed by Uber's Chinese officials in an email to Reuters in February 2016. Despite Kalanick claiming that "We have a fierce competitor that's unprofitable in every city they exist in, but they're buying up market share...", a spokesman from Didi Chuxing responded in an email to Reuters that Uber's assertions were untrue and that "smaller competitors have to bleed subsidies to make up for their insufficient driver and rider network." The spokesperson further said that Didi Chuxing had passed the break-even mark in over half of the 400 Chinese cities they operate in.

On May 12, 2016, Apple Inc., invested $1 billion USD in the company.

Services

Didi Chuxing is an application where taxis, premium cars and designated drivers can be hired via smartphone. It is similar to apps such as GrabTaxi in Southeast Asia.

As of May 2015, Didi Chuxing had 1.35 million drivers operating in 360 Chinese cities, with 4 million daily calls for taxis. Its closest local competitor, Uber, claimed to a letter to their shareholders in June that their local unit, Uber China, was completing one million trips daily. Didi Chuxing's premium car hire service, meanwhile, was operating in 61 cities with another 40,000 drivers, servicing 1.5 million calls every day. As part of an aggressive investment to allow them to consolidate their dominant market position, Didi Chuxing announced extra features for the application in that month alongside its basic taxi-calling function such as the ability to carpool, hire premium cars, hire designated drivers and use a special service for passengers with disabilities.

In June 2015, Didi Chuxing estimated that by the end of the year, US$12 billion would be spent annually on its platforms. It aims to serve 30 million passengers daily with 10 million drivers within three years.

Didi Bus launched initially in Beijing and Shenzhen as a WeChat-based trial, providing 1,500 daily rides and transporting approximately 500,000 daily commuters by the time of its official launch in October 2015. Working with tourism companies and bus-leasing operations to offer rides on 51-seat, air-conditioned, Wi-Fi-equipped coaches, it touts the service as costing, on average, RMB7–13 (US$1.10–US$2.04) – making it cheaper than their own cars or taxis for hire. Mainly focusing on longer routes (such as commuter, tourist and airport routes) instead of competing with existing public bus infrastructure, major companies such as Lenovo and Huawei are using tailored versions of Didi Bus' service to transport employees.

See Also

• Apple Inc.

External links

• Official website (Chinese)
• Official website (English)