Didi ‘all in’ on safety, admits huge losses

Chinese online ride-hailing giant Didi Chuxing said the company will be “all in” on riding safety while showing losses over the past few years, according to an internal company letter sent to the Global Times Friday.

Cheng Wei, CEO of the Beijing-based startup, said in the letter that Didi does not believe in “earning money trumps all.”

Founded in 2012, Didi has not been profitable in the past six years, the CEO said.

“In the first half of 2018, the company suffered net losses of over 4 billion yuan ($584.9 million). The average take rate of our mobility business corresponding to gross merchandise volume [GMV] is about 16 percent, most of which has been returned to drivers and passengers. The gross profit margin corresponding to GMV is only 1.6 percent,” read the letter intended for Didi’s employees.

Following the latest murder case of a Didi driver, who killed a 20-year-old passenger in August in Yueqing, East China’s Zhejiang Province, which has sparked nationwide concerns over the safety of China’s shared-riding industry, Cheng conceded that the company’s expansion model has already created hidden dangers.

“However, we have not fully understood the responsibilities and challenges that the era’s opportunities have brought. We lack reverence,” Cheng said.

“Our safety standards have blind spots. The prevention system is not comprehensive in the face of serious cases, which offered a chance for criminals to get through, causing irreversible damage to users and costing us heavily,” the CEO noted.

Shanghai transport and police authorities started comprehensive on-site inspections of the ride-hailing platform on Friday, the paper.cn reported.

Before that, Ministry of Transport (MOT) officials and other government departments started their inspections on Didi in Beijing on Wednesday. The MOT said all other ride-hailing and hitch service platforms would also be inspected.