Used car sec­tor mo­tors into a mod­ern era

China Daily (Hong Kong) - - BUSINESS - By ZHENG YIRAN zhengyi­ran@ chi­

The in­tro­duc­tion of big data and ar­ti­fi­cial in­tel­li­gence has helped re­solve the peren­nial cred­i­bil­ity prob­lems of the used car mar­ket, pro­vid­ing more op­por­tu­ni­ties for the sec­tor, an­a­lysts said last month.

“There is huge growth po­ten­tial in China’s used car mar­ket,” said Zhao Xiang, a trans­porta­tion an­a­lyst at Bei­jing-based Analysys, a mar­ket re­search house.

“With the rapid devel­op­ment of the mar­ket and the in­crease of as­sess­ment tech­niques, con­sumers’ ex­pec­ta­tions of a used car are con­tin­u­ously ris­ing,” said Zhao Xiang, a trans­porta­tion an­a­lyst at Analysys.

While the mar­ket is grow­ing rapidly, credit is­sues have al­ways acted as a brake on the devel­op­ment of the used car mar­ket.

In re­sponse, play­ers have in­tro­duced big data and ar­ti­fi­cial in­tel­li­gence to re­duce the var­i­ous trans­ac­tion risks, the big­gest of which are prob­lems with credit., China’s big­gest used car trad­ing plat­form, said that in or­der to ad­dress credit is­sues, it has de­vel­oped a data­base us­ing big data and ar­ti­fi­cial in­tel­li­gence.

Chief Tech­nol­ogy Of­fi­cer Zhang Xiaopei said the data­base stores in­for­ma­tion on more than 3.5 mil­lion cars and from 200 mil­lion buy­ers and sell­ers. In ad­di­tion, it in­cludes a huge amount of third party data, about the main­te­nance and re­pair his­tory of the cars.

“With the data­base, the in­for­ma­tion on used cars as well as buy­ers and sell­ers is more trans­par­ent, which has greatly in­creased trans­ac­tion se­cu­rity,” Zhang said.

He said that with the help of the data­base, the car trad­ing plat­form’s trans­ac­tion vol- umes had grown by 700 per­cent last year. re­cently an­nounced over $400 mil­lion in Se­ries B fi­nanc­ing from global in­vestors, mak­ing it one of the big­gest fundrais­ings this year among Chi­nese in­ter­net com­pa­nies.

The cap­i­tal will be used for de­vel­op­ing new busi­ness lines and in­creas­ing brand aware­ness, as well as de­vel­op­ing the skills base of the com­pany’s staff.

The new round of fi­nanc­ing is be­ing led by ex­ist­ing in­vestor Se­quoia Cap­i­tal, a lead­ing ven­ture cap­i­tal firm. Ma­trix Part­ners China, Blue Run Ven­tures and Hike Cap­i­tal in­creased their in­vest­ment.

Other par­tic­i­pat­ing in­vestors in­clude H Cap­i­tal, Dragoneer In­vest­ment Group, China Mer­chants Bank and Shougang Group. China’s lead­ing bou­tique in­vest­ment bank, TH Cap­i­tal, was the ex­clu­sive fi­nan­cial ad­vi­sor

checks a sec­ond-hand car at an au­to­mo­bile trad­ing com­pany in Suzhou, Jiangsu prov­ince.

on the deal.

“In or­der to trans­form the tra­di­tional in­dus­try, we also need to de­pend on on­line tech­niques. will con­tinue to im­prove our busi­ness and ser­vice by know­ing more about cus­tomer be­hav­ior through our data anal­y­sis,” said founder and CEO Mark Yang.

The com­pany has cre­ated a data­base of over 3.5 mil­lion cars and over 200 mil­lion po­ten­tial cus­tomers. Pow­ered by ar­ti­fi­cial in­tel­li­gence, is mak­ing it faster and eas­ier for con­sumers to buy and sell used cars through pre­dic­tive pric­ing and en­hanced knowl­edge of cus­tomer pref­er­ences.

Steven Ji, a part­ner of Se­quoia Cap­i­tal China, said that is lead­ing the devel­op­ment and evo­lu­tion of the in­dus­try, and has ma­jor growth po­ten­tial.

The coun­try’s stress on en­vi­ron­men­tal pro­tec­tion and de­mand for clean en­ergy also brought op­por­tu­ni­ties for the ex­pan­sion of Eco­lab’s China busi­ness, he said.

Eco­lab China’s fac­to­ries are lo­cated in south­ern and east­ern ar­eas of the coun­try. “Food safety is closely linked to the dairy in­dus­try. And China’s north­ern re­gion pro­duces most of the dairy prod­ucts,” he said.

So, the com­pany is plan­ning to set up a pro­duc­tion base in north­ern China, but no spe­cific city has yet been short­listed, he said.

Eco­lab’s tech­nol­ogy plat­form can mon­i­tor ev­ery pro­ce­dure of food and bev­er­age pro­duc­tion, con­trol the amount of clean­ing wa­ter and mea­sure the clean­ing ef­fect. Col­lec­tion of such data can help im­prove ef­fi­ciency, re­duce the cost of en­ergy and wa­ter for dif­fer­ent com­pa­nies, he said.

“Though the growth rate of the Chi­nese econ­omy has slowed, it’s still grow­ing at a mod­er­ate pace,” he said. “We fo­cus on pro­vid­ing so­lu­tions for prob­lems of food safety and short­age of wa­ter re­sources in China, which have both re­al­ized a sta­ble and fast growth by now.”

The past two years saw dou­ble-digit growth in the food safety busi­ness in China, he said. And the com­pany’s global sales reached $13 bil­lion in 2016.

The par­ent’s mar­ket value rose to $36 bil­lion last year, he said.

Eco­lab’s lo­cal unit was set up in 1975. Its clean­ing and dis­in­fec­tion meth­ods have been used in most of the five-star restau­rants and more than 80 per­cent of food brands, in­clud­ing McDon­ald’s, KFC and Star­bucks in China, Wang said.

The com­pany has iden­ti­fied cer­tain ar­eas to fo­cus on in fu­ture, he said. Eco­lab China would ap­ply its tech­ni­cal strength to solve dif­fi­cult prob­lems in waste wa­ter treat­ment, such as the re­moval of phos­phate and heavy met­als.

With the World Eco­nomic Fo­rum’s Sum­mer Davos con­ven­tion in Dalian in June lay­ing emphasis on the Fourth In­dus­trial Revo­lu­tion, Eco­lab is also eyeing dig­i­tal­iza­tion as a new growth point, Wang said.

The com­pany will set aside $200 mil­lion ev­ery year for re­search to ex­plore ap­pli­ca­tion of tech­nolo­gies like in­dus­trial dig­i­tal­iza­tion, au­to­matic con­trol and big data in food safety.

A cus­tomer (left)

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