Traditional Taxis Seek Solutions Under Pressure From Ride-Hailing Apps
Ride-hailing use is overtaking traditional taxi services in China. Image: hot.online.sh
Traditional taxis are losing their customers under the pressure of ride-hailing services. Companies from both sides are taking opportunities to evaluate potential cooperation.
Didi Chuxing, a China oriented ride-hailing company, hosted a seminar about the fusion of taxis and private cars on June 28. Its vice president Zhang Bei stated that they will invest 1000 million yuan to set up a fund for the transformation and upgrade of taxi services.
There is no doubt that the rapid growth of the private-car ride-hailing use has greatly squeezed the market of traditional cab companies.
Didi users hold 88.4% in the whole ride-hailing market in 2015. Image: it.people
Recently Shanghai Dazhong Taxi Company has written an open letter to Ministry of Transport to propose an investigation of fair competition according to the Interim Administrative Measures for Ride-hailing Companies.Obviously, the company targets at Didi chuxing who holds the largest portion of ride-hailing market in China.
The initial business for Didi was offering mobile taxi booking which helped reduce empty ratios and increased driver's income. However having now introduced ride-hailing and ride-sharing services, taxi services are facing big difficulties. Meanwhile, taxi companies themselves have other problems to be solved such as low income of drivers and inefficient management.
Didi Chuxing is looking at its own successful private-car ride-hailing system in order to use big data to create win-win technological solutions, helping to make taxis operate more efficiently, said Zhang Bei.