German auto giant Daimler has set up a joint venture (JV) called Weixing Technology in Hangzhou with Chinese carmaker Geely, company registration records show. The two corporations will each invest RMB 850 million (USD 123.5 million) and have equal share of the JV.
Weixing Technology has been granted licenses to provide car rental and ride-hailing services among other businesses. Geely’s boss Li Shufu is the biggest shareholder of Daimler Mobility Services‘ parent company Daimler AG after he acquired a USD 9 billion stake in February 2018.
The two companies signed a deal last October, laying out the plan to enter China’s high-end ride-hailing market. The JV will provide its services using premium vehicles, including Mercedes-Benz’s S-Class, E-Class, V-Class, and Maybach, as well as electric vehicles designed by the Geely Group, accordion to a statement from both companies released last year.
As of the end of 2018, China has 285 million ride-hailing service users, and the market is projected to reach 600 million users by 2020, according to Guangzhou-based data consultancy iiMedia Reseach.
Geely also owns Caocao Chuxing, a ride-hailing platform that was set up in 2015. Caocao Chuxing is now the third most popular ride-hailing app in China in terms of monthly active users, after Didi Chuxing and Dida Chuxing, according to China-based mobile internet data monitor Trustdata.