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Didi faces an uphill battle alongside its global expansion plans

Written by Robin Moh Published on   2 mins read

Didi battles on to solve transportation woes.

At a recent European Technology Summit, LIU Qing, the President of Didi Chuxing, revealed her core belief that technology should, in fact, benefit everyone and that it’s not just reserved for the privileged wealthy segment of societies.

In line with that mindset, the company she heads, Didi Chuxing is one that seeks to continuously innovate and push the frontiers of cutting-edge technology to fill the very real gap in transportation woes of very crowded Chinese cities.

Contrary to the common term as being ‘the Uber of China’, the company is in fact very different. While equally competitive, it is actually very clear on the ‘comparative advantage’ that domestic players might have and hence is open to explore partnerships in its bid to expand internationally, as opposed to its American archrival expansion strategies.

For instance, rather than fight to dominate, Didi is currently working with Grab, another ride-hailing giant, in Southeast Asia. In Brazil, however, Didi acquired its ride-hailing rival, before entering the country.

Its latest international expansion according to its globalization strategy, would be to combat Uber in Melbourne, the second most populated city in Australia. The company intends to launch their ride-hailing services from the 25th of June.

While Didi commented that Australia’s diversified mobility needs, business-friendly environment, and inclusive culture are a boon for the company to contribute by offering affordable, reliable and convenient mobility solutions there, an Uber spokesman responded by being very welcoming of the impending competition in a bid to keep them focused on delivering the very best product and customer experience in Australia.

Even as Didi’s foray into the Western market is caught in intensifying competition, it also has its fair share of domestic woes.

Other Chinese companies that do not traditionally provide ride-hailing services have started to attempt to compete with Didi.

Some notable examples include Alibaba-owned mapping firm, AutoNavi, Chinese O2O platform giant, Meituan Dianping and Chinese OTA leader, Ctrip. Unlike their predecessor Uber, their deep local market knowledge, unique comparative advantage and eagerness to capture a slice of the already saturated Chinese ride-sharing market could be worrying for Didi.

Meituan, for example, has already achieved a staggering feat by quickly acquiring over 30% market share in the cities of Shanghai and Nanjing, within a short few days after its launch.

Furthermore, the coming IPO of Meituan might provide the much-needed ammunition the company needs to fight long-time market leader Didi, signaling an imminent wave of blood bleeding competition, not seen before since Uber’s exit from China.

In addition to these competitive pressures, we also reported earlier of a case of a murdered Didi passenger, which sparked off the rage and concerns of the safety of Didi’s ride-hailing services among the Chinese.

The latest move to ban male drivers from picking up female passengers in the wee hours of the night as an alternative was met with mixed feelings whether the proposed solution will work. As it is dangerous driving alone at night, this might pose a problem in finding sufficient female drivers to meet the demand.


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