Didi drives into Japan with Softbank joint venture

Didi plans to launch its Japanese pilot programme by September this year.

Photo: KrAsia

Chinese ride-hailing giant Didi Chuxing and Japanese conglomerate SoftBank Corp have established a joint venture to launch its services in Japan, SoftBank announced on its website today. We previously wrote about its plans to do so in February.

The joint venture, known as Didi Mobility Japan Corp, will leverage machine learning-based technology to improve dispatching and predict demand, said the firm, in an effort to improve local taxi industry’s efficiency.

Pilot operations will begin by September of this year in Osaka and will expand to other Japanese cities such as Kyoto, Fukuoka, Okinawa, and Tokyo gradually.

Given that most of Didi’s 550 million registered users are from China, even as it expands overseas to markets like Mexico and Australia, Chinese travellers in Japan can also pay for their rides via Alipay or WeChat Pay.

Also Read: Didi gets $500m from Booking: hotels, taxis interchangeable on apps

According to data from the Japan National Tourism Organisation, over seven million Chinese tourists visited Japan in 2017, making China the largest source of foreign visitors to Japan.

Didi Japan’s app will come with an automatic translation function, which allows users to switch between Japanese and Chinese easily. Taxi companies can also review evaluations from the consumers on drivers, and manage their fleets through the Didi Japan platform.

Didi has shown that its operations plan for each market is different. In a move to tackle the Latin American market, Didi acquired Brazilian startup 99 in January this year. It has invested in Southeast Asian company Grab, and now in Japan, it is opting for a joint venture instead.

While taxi-hailing has become quite a saturated market in most developed countries, in Japan, people are still warming up to the trend.

Taxi drivers often drive black cars, wear white gloves, and have strong trade unions to protect them from the rise of Uber and such companies. Even Dara Khosrowshahi, CEO, Uber, concedes that instead of going with an aggressive approach, the company needs to cooperate and partner up with local firms instead. Only in May 2018 did Uber get approved for its pilot-testing programme in Japan, a small step forward for the US tech giant.

“Ride-sharing is prohibited by law in Japan. I can’t believe there is still such a stupid country,” said Masayoshi Son, the CEO of Softbank, reported Reuters today.

In February this year, Japanese corporation Sony also made known its plans to roll out an artificial intelligence-based ride-hailing service. Working with six taxi companies with 10,000 vehicles collectively, Sony’s ride-hailing service was said to be targeted towards commuters in Tokyo.

KrASIA has reached out to Didi Chuxing for more information on its plans in Japan.

Editor: Ben Jiang