You are here
Update: Chinese taxi app gains US$600m investment from Softbank, Alibaba
[TOKYO] Japan's SoftBank Corp said it and other firms including Chinese e-commerce giant Alibaba Group Holding Ltd had invested about 70 billion yen (US$600 million) into Travice Inc, the operator of Chinese taxi hailing app Kuaidi Dache.
Alibaba already holds an undisclosed stake in Kuaidi, one of two local apps that together control around 90 per cent of the China online taxi hailing market.
An Alibaba spokeswoman said SoftBank had contributed the bulk of the funding. The investment marks the latest bet by the Japanese internet company on taxi hailing apps after it poured almost US$500 million last year into Southeast Asia's GrabTaxi and Indian app Ola, owned by ANI Technologies. "Kuaidi Dache has grown to become a leading player in the Chinese mobile taxi booking industry, and we are convinced it will see further remarkable growth," Nikesh Arora, vice chairman of SoftBank Corp, said in a statement on Thursday. The company did not give a valuation for Kuaidi.
SoftBank's other investment partners include Tiger Global, which also holds a stake in Kuaidi. The app will use the funds to expand its services and market share, Kuaidi CEO Chuanwei Lu said in the joint statement.
Kuaidi competes with Didi Dache, in which internet firm Tencent Holdings Ltd has a stake, and US firm Uber Technologies Inc, which is backed by Chinese internet firm Baidu Inc, in a market that Chinese firm iResearch estimates will see user numbers triple to 45 million this year compared to 2013.
Many tech industry analysts expect these rides-on-demand to become a key link in domestic logistics over the long term, making them attractive to e-commerce companies such as Alibaba.
The SoftBank-led investment comes a week after China's transport ministry banned car hailing apps from using cars and drivers without taxi licenses in a bid to regulate the fast growing sector.
Taxi drivers across China have recently gone on strike primarily against high taxi rental fees, but underpinned also by agitation over online competitors which have given customers the choice to call private cars without taxi licenses.