Alibaba, Tencent, Chinese Car Makers Agree on New Ride-hailing Service
Alibaba, Tencent, Suning, Changan Automobile, China FAW and Dongfeng Motor have set up a $1.5 billion Chinese ride-hailing venture, a move that could test the dominance of ride-sharing giant Didi Chuxing.
Changan Automobile has invested 1.6 billion yuan ($238.36 million) in the new ride-sharing company, which will combine the strengths of the participating partners in various fields to provide a connected mobility service that could compete with Didi Chuxing, which currently takes 90 percent of all bookings.
Changan, Dongfeng and FAW will each have a 15 percent stake in the joint venture, which will focus on new energy vehicles. Suning will be the biggest shareholder with a 19 percent stake while Alibaba and Tencent’s investment units will together hold the remainder shares with some other funds, Changan added.
Other car makers, from BMW, Geely to SAIC as well as other tech firms such as Meituan Dianping have also launched their own mobility services in a bid to grab a share of the fast growing market.
Didi, which is backed by Japan’s SoftBank Group Corp and Uber Technologies, also has joint ventures with BAIC and Volkswagen.