We hope to win the global bat­tle through op­ti­miza­tion of our in­ter­nal strength ...”

China Daily (Latin America Weekly) - - Business -

One Fe­bru­ary morn­ing, nearly 9,000 peo­ple braved sub-zero tem­per­a­ture and chilly wind to as­sem­ble at a Beijing sta­dium to wildly cheer their em­ployer’s stu­pen­dous suc­cess over­seas.

The com­pany con­cerned was Didi Chux­ing, China’s largest ride-hail­ing com­pany and the world’s sec­ond most valu­able startup af­ter Uber Tech­nolo­gies Inc; and the event was its an­nual lu­nar year-end con­fer­ence.

Didi in­spires such fierce loy­alty and un­stint­ing ad­mi­ra­tion not just from its em­ploy­ees but users, clients and in­vestors alike. At the con­fer­ence, Didi’s CEO and founder Cheng Wei held cen­ter stage and thanked the gath­er­ing as well as the 1,000 new staff in Brazil.

A month back, glob­al­minded Didi had bought a con­trol­ling stake in 99, a ma­jor ride-hail­ing com­pany in Brazil, South Amer­ica’s largest econ­omy. The deal marked Didi’s first cross-border ac­qui­si­tion.

“Go­ing global is a top strate­gic pri­or­ity for Didi,” said Cheng. “Now we have em­ploy­ees on the other side of the earth. It takes two days for them to come to Beijing by plane.”

That was not an off-the-cuff re­mark. Cheng was hint­ing at Didi’s broader am­bi­tion to trans­form in­ter­na­tional trans­porta­tion even­tu­ally by in­no­vat­ing tech­nol­ogy.

Af­ter first out­com­pet­ing its arch ri­val Uber, and then forg­ing a merger with it in China, Beijing-based Didi is ex­pand­ing glob­ally, and will still fight Uber in other mar­kets by part­ner­ing the lat­ter’s ri­vals.

The com­pany, founded with 800,000 yuan ($121,000) six years ago, has grown into a heavy­weight with a val­u­a­tion of $50 bil­lion. Sit­ting on abun­dant cash and armed with a rich com­bi­na­tion of tal­ent and tech­nolo­gies, Didi now aims to rev­o­lu­tion­ize trans­porta­tion glob­ally.

“In 2018, we hope to win the global bat­tle through op­ti­miza­tion of our in­ter­nal strength,” Cheng said. “Af­ter squat­ting down to hone our skills for a year, we are at a bet­ter po­si­tion to jump up.”

Jumped up it did days be­fore the Fe­bru­ary an­nual con­fer­ence. Didi an­nounced it will en­ter the Ja­panese mar­ket through a taxi-hail­ing joint ven­ture with SoftBank Corp. Brazil. founder of Didi Chux­ing, China’s largest ride-hail­ing com­pany, at work at their of­fices in Sao Paulo, Didi’s CEO and

Un­der the part­ner­ship, the two sides will build a ride­hail­ing plat­form to en­hance ef­fi­ciency for both taxi op­er­a­tors and driv­ers. They aim to com­mence trial ser­vices in Osaka, Ky­oto, Fukuoka, Tokyo and other lo­ca­tions this year.

Though the spe­cific in­vest­ment size of the joint ven­ture was not dis­closed, Didi said in a state­ment that by in­te­grat­ing its deep learn­ing-based de­mand pre­dic­tion and smart dis­patch sys­tems with SoftBank’s lo­cal re­sources and ex­per­tise, the two com­pa­nies aim to op­ti­mize taxi ride-hail­ing ser­vices and in­crease pas­sen­ger con­ve­nience.

“We will en­gage with in­dus­try prac­ti­tion­ers, pol­i­cy­mak­ers and other stake­hold­ers, with the aim of build­ing an open and in­clu­sive plat­form that will be avail­able to all of Ja­pan’s taxi op­er­a­tors,” Didi said.

Wang Xiaofeng, a se­nior an­a­lyst with re­search firm For­rester, said Didi is mak­ing a ma­jor change in its glob­al­iza­tion strat­egy. Pre­vi­ously, it had beefed up its over­seas pres­ence mainly through in­vest­ing in pi­o­neer­ing lo­cal play­ers, such as Lyft in the United States, Ola in In­dia, Grab in Sin­ga­pore, Tax­ify in Es­to­nia and Ca­reem in the Mid­dle East. All of them are fierce com­peti­tors of Uber in their re­spec­tive re­gions.

“But now, it’s opt­ing to move for­ward through merg­ers and ac­qui­si­tions, as well as by set­ting up lo­cal com­pa­nies on its own,” Wang said.

Agreed Zhao Xiang, an an­a­lyst at Beijing-based in­ter­net con­sul­tancy Analysys. Ac­qui­si­tions, rather than pure in­vest­ments, will give Didi more de­ci­sion-mak­ing power in its part­ners’ de­vel­op­ment in the fu­ture and can bet­ter ex­port its ar­ti­fi­cial intelligence tech­nol­ogy, he said.

“Though build­ing lo­cal part­ner­ships with in­flu­en­tial lo­cal part­ners is a faster way than start­ing from scratch, ac­qui­si­tions and get­ting a foothold in for­eign coun­tries on its own can give a stronger im­pe­tus to Didi’s over­seas busi­ness and help it bet­ter take on Uber,” Zhang said.

Also, un­like other Chi­nese com­pa­nies that tar­get South­east Asian coun­tries as their start­ing point for global ex­pan­sion, Didi is putting heavy em­pha­sis on South Amer­ica.

It re­port­edly spent $600 mil­lion for com­plete con­trol of 99 in Brazil. Didi also ad­ver­tised on­line for a range of jobs in Mex­ico as it pre­pares to en­ter the mar­ket that is one of Uber’s re­gional strongholds.

Didi plans to launch a smart­phone app in Mex­ico this year and re­cruit driv­ers for its plat­form, Reuters re­ported in De­cem­ber.

Didi’s grow­ing in­ter­est in Mex­ico and, more broadly, Latin Amer­ica, may well be part of a de­lib­er­ate strat­egy, given that Uber dou­bled down on this mar­ket af­ter fail­ing to beat Didi in China, an­a­lysts said.

Cheng Wei,



Newspapers in English

Newspapers from China

© PressReader. All rights reserved.