Didi injects $ 1 billion into automotive service unit
Didi Chuxing announced that it will inject $ 1 billion into rebranding its auto services unit, accelerating its drive to build a transportation empire that offers services beyond its core ridesharing business.
The unit will be split into a new company named Xiaoju Automobile Solutions Co., Didi said in a statement on Monday.
âThe creation of Xiaoju Automobile Solutions is not only a key step towards the realization of Didi’s automotive alliance strategy, but also an important step in organizational innovation as we continue to expand our business horizon,â said CEO and founder Cheng Wei said in the statement.
Didi officially launched its automotive solutions platform in April to provide services which include rental and trading, refueling, maintenance and repair.
The platform has annual revenue of more than 60 billion yuan ($ 8.8 billion), with a presence in 257 cities through a network of more than 7,500 partners and distributors, according to the statement.
Also in April, Didi launched an alliance with more than 30 automakers and tech companies to jointly develop new technologies and vehicles to solidify its expansion into the wider automotive ecosystem. Alliance members include BAIC Motor Corp. Ltd., China FAW Group Co. Ltd., BYD Co. Ltd., Volkswagen Group China and Robert Bosch GmbH.
The rise of carpooling platforms has long been a threat to automakers, who fear that more consumers will choose to share a car instead of owning one. Industry watchers said their willingness to partner with Didi shows that automakers are now tweaking their strategy to work with – instead of competing with – ridesharing platforms to create a “win-win” scenario. “.
Didi controls more than 90% of the Chinese VTC market, serving 550 million users. The company said its daily trips reached 30 million with more than 30 million active drivers on its platform.
The company was valued at $ 56 billion after complete a $ 4 billion fundraiser late last year from investors including Japanese telecommunications giant SoftBank Group Corp.
Contact journalist Mo Yelin ([email protected])
You have accessed an article available only to subscribers