Sizheng Chen (), personne chez Houzz
Répondu il y a 126w · L'auteur dispose de réponses 198 et de vues de réponses 979k
Réponse courte: Currently and in the foreseeable future, Didi and Uber do / will both keep their #1 and #2 position in the ride-hailing market in China. Uber will gradually and slowly grow their market shares, and probably part of the addition will come from Didi.
- Ride-hailing market in China
It’s just massive.
Uber’s revenue in 2015 is around $1.5B.1 Uber takes 20% of the fares, so the total money spent on Uber’s platform is $7.5B.
Didi claimed in June 2015 that it estimated it would be a total of $12 billion spent on its platform by end of 2015.2
If Didi’s estimate was not way off, at least the market cap of China is comparable to the rest of the world.
This is why Uber opened Uber China as an independent company in Mar 2014, and it got its own valuation - $8 billion, while Didi’s latest valuation is $25 billion,340% of Uber’s $62.5 billion, with only focusing on one country - China.
Selon 4 , the number of requests on Didi is about 7 million per day, as of Jan, 2016, while the total number of requests on Uber is just about 2 to 3 millions per day globally. Didi also said it aimed to serve 30 million riders by mid to end of 2018. 5 That combines of $12 billion market cap give close to a total of $50 billion market.
So clearly on a high level, even Uber knew Didi was already dominant the market in 2014 when they setup Uber China, competing for #2 position still makes business sense.
And they made it. By pouring $1 billion in 20156 , they “successfully” grow their market share from 0% to about 15% to 17%. (See the estimation below in the app download comparison section).
- App download comparison
- On the Android side: (Quoted from coolchuan.com(酷传))
- Didi’s total android app downloads grew +43% from 420MM on 1/1/2016 to 601MM in less than 6 months, while Uber grew +55% from 81MM to 126MM in the same period.
- Based on the same data, the other way to look at it is, Didi’s total android app download was 5.2X of Uber’s on 1/1/2016, and now is 4.76X. Based on 7, Didi owns 80% of private cars market as of Sep 2015, so approximately, at the beginning of this year, Uber owned about 15% of the market share. And as of 5/18/2016, assuming Didi still owns 80% of the private cars market, Uber’s share will grow to about 17%.
By the end of this year, the ratio will be further reduced to 4.5X-4.6X, and Uber will probably owns 18%-19% of the market, assuming maybe less than 1% will be from Didi. This could be a consequence of Uber’s expansion to 100 cities by the end of this year.
- Didi’s total Android app download trend
- Uber’s total Android app download trend
- on iPhone side (Quoted from ann9.com(应用雷达))
- Uber’s app ranking on appStore is gradually catching up.
It was hovering around #50 since Mar this year, and it got a decent jump pretty recently, the overall trend is it keeps improving.
While Didi has been hovering around #10 since Mar this year, and got a dip in early May and for the first time, the ranking of Didi is lower than Uber.
It’s always a positive sign if you see your app ranking improved. This means your customers love the product, which is another key metric to the ride-hailing app. It slightly suggests currently Uber has a good if not better product.
- Didi’s last 3 month app ranking on iPhone
- Uber’s last month app ranking on iPhone
- Dispatch algorithm comparison
Actually there is a key difference between Uber and Didi regarding how the job are dispatched to the drivers.
In Didi’s model, when a rider needs a ride, all drivers within X kilometers can see the request (including iternary) and drivers race for getting the request.
While Uber will automatically dispatch the job based on certain criteria (mostly the shortest distance). Didi recently added the auto dispatch mode to gurantee some drivers are not good at racing can still get some jobs, but after talking to some of friends in China, they told me majority of Didi drivers still choose to “race”.
In the ideal world, Uber’s model favors both drivers and riders, it looks strictly better.
But in reality, this is why Uber lose huge money initially when they started to subsidize the driver to break the market and caused a lot of fraud.
It turned out some Chinese drivers quickly discovered how Uber’s dispatch algorithm works, and they bought two phones and one installs the rider app the other one installs the driver app, since the two phones are physically together, Uber’s algorithm gurantees the “driver” app will get the “rider”’s request, and the actually driver just need to drive on the road alone and get the allowance from Uber.
These fraud was relatively quickly discovered by Uber and they tried to patch this hole by various ways but it already costed them huge amount of money before they eliminate most of the fraud scenarios.
Actually there is another consequence from these two different dispatch algorithm. I was told by my friend in China, since all drivers can see the iternary, a lot of Didi drivers are not willing to do short distance rides, while this is less a concern for riders using Uber since Uber’s algorithm prevent this from happening. So this could be one of the reasons why some people started using / like Uber.
Liu Chuanzhi is the founder of Lenovo, and well known as the god father of IT industry in China.
Son niece Liu Zhen is Uber's director of China Strategy and his daughter Liu Qing is the president of Didi.
In other words, the head of Didi and Uber China aren’t personal rivals, they are cousins.
They are both professional executives, but my guess is their personal relationship will make the price war a little bit less bloody (if you are familiar with Chinese culture, you know what I am talking about) and I guess it is one of the important factors why Uber chose Liu Zhen.
- Liu Qing (President of Didi)
- Liu Zhen (Director of China Strategy, Uber)
- Liu ChuanZhi (founder of Lenovo, investor of China Auto Rental (神州专车))
Both Didi and Uber has very solid position in China now and for the foreseeable future. But since Didi has the first move advantage, and the ride hailing market really favors the first mover, unless Didi makes several big mistakes, it is impossible for Uber (about 15–18% share) to catch up Didi (about 80% market share), in the next 5 years. And by looking at the data above, Didi will also have a hard time to squeeze Uber’s share either, given Uber’s healthy growth trend.
While the competition will still be brutal, both sides know that the bloody price war they did in 2015 will not help them eliminate each other. So they will subsidize relatively more conservatively to their drivers to keep the capital and should enjoy its current position and eat the big China pie happily together.
Notes de bas de page
Répondu il y a 126w
Since lately the headline of Apple’s decision to invest one billion dollars into Didi Chuxing has caught people’s attention. It’s worth pointing people to follow up on some of the China market news driven by Didi since 2015 so to better understand what has led to this exciting turning point and that may well be poising Didi to becoming the world’s leading company not just in the ride-hailing service but in reshaping “the share economy” model.
Yes, you read that right. Uber often in defense of its controversial definition of “the share economy” ought to learn an inspiring lesson from Didi’s business strategies. And I think it is a much healthier competition now with Didi in the driver seat. (note: I am not claiming that Uber would be one day defeated by Didi all together anywhere else outside of China. But rather I’m thinking that Uber’s worst enemy is actually in its own business philosophy, not simply the pressures from Didi or Lyft or labor lawyers or foreign market regulators, as some of you might challenge my point of view).
In the race to global market competition, I strong believe that Didi only sees Uber as a linear dimension competitor however fierce the game is. Didi from the start is playing the game quite differently beyond what Uber has started. While it took Uber nearly 6 years to achieve a combined 1 billion rides globally, Didi reached an eye-popping 1.43 billion rides in just short 12 months in 2015 in China alone. This number is 2x of the yearly total taxi rides in the US. It is easy to argue that China’s economic scale and cultural advantage make it so much likely to being bigger very quickly for any Chinese startup to rise in their home market competing against their American counterpart of the original business concept. But that argument is only shallow and missing a crucial insight on Chinese business mindset.
Chinese entrepreneurs are constantly looking for an angle in gaining the optimal favor whether or not the upper hand is directly or indirectly produced out of their own deck. Unbound by structural paradigms as a new economy, Chinese businesses are more flexible thinking in new boxes, willing to take risks, to experiment, to diversify, and to correct their course of actions swiftly after learning curves until succeeding. They often bring to the negotiation table the win-win strategic offering in light os benefiting all parties participated in the economic equation. In mobile commerce namely the end user, the service producer and platform owner, and for what they are in it for, everybody gets what they want in result of a reasonable distribution from the deal.
Didi understands what consumers want and need in real deals. And it is also wise of the Chinese startup to accept that in order to become a successful business the company doesn’t necessarily have to drain its entire resources in developing each and every products and services in playing genius so to wall off its customers from the competition. Didi generously brings to its customers many value-added services from third parties outside of the company’s own core products. Despite Uber’s $1 billion firepower thrown into the market in hope to compete, in result Didi wins over Chinese consumers with 99% of taxi-hailing and 80% of private car ride-sharing market shares (data as of September 2015).
This is where Uber is biting the dust. One important decision by Didi is open API to third party app developers for cross platform mobile commerce plug-ins. Didi openly welcomes strategic cooperations from third parties and shares the economic values of its massive consumer pool with them. Even in alliance with competitors. In this case, Lyft in America, Ola in India, and GrabTaxi in Southeast Asia — the enemy of my enemy is my friend — in service to Chinese traveling overseas and foreigners visiting China without language barriers and payment concerns by using Didi App and fulfilled by Lyft or Ola or GrabTaxi, and vice versa.
Didi Chuxing is born out of a merger in 2015 of China’s top two ride-hailing rivals — Didi Dache (2012) and Kuaidi Dache (2011). Initially a copy of Uber as a taxi-hailing platform that connects taxi drivers and passengers on mobile app. With a focus on solving China’s transportation challenges Didi has evolved since 2012 and now facilitates a comprehensive ecosystem designed to make personal transport commerce much easier, more accessible and more efficient. And every players on Didi’s platform benefit, in one way or another.
Didi's founder and CEO Cheng Wei said that his company would continue to grow as it explores new ways of getting from point A to point B such as self-driving cars. But getting people from A to B is just the start of Didi’s ambition. Didi plans to offer a variety of other services that make the most of its huge pool of users and the trove of data it holds on them. Today Didi has expanded its service offerings and enterprise solutions to include:
- Ride Hailing : taxi / private car
- Personalized Ride : social ride sharing based on common interests (ex. share-ride matchmaking via LinkedIn for office workers) / carpooling / designated driver
- Group Transportation : shuttle van / private bus with driver for hire
- VIP Service : luxury car rental / premium car with chauffeur for hire
- Test Drive Service : local dealership at your door step / connecting to car-owner nearby for hailing a test drive
- Car Sales : experimental collaboration with Mercedes and Toyota (and in the next lineup if the result goes well: VW, Honda, Nissan, Ford, Chevy, etc.) Didi offers manufacturer’s cash back to both the car-owners and car-buyers. Not only is the shopper getting a better deal of sticker price on Didi ($5,000 to $6,000 lower than MSRP), testers-turned-owners who lend out 50 rides can earn additional RMB10,000 and RMB30,000 for those who lend out 100 rides.
Customer centric market strategies and open doors for collaborative alliances with third parties as well as turning the car-for-hire industry competitors into partners, Didi offers far wider value-added services and full range of enterprise solutions for every type of driver, passenger, commuter and transport industry. Far exceeding Uber's linear business core and centralized profit model.
As a poster child of “the share economy” in turning traffic into money, Uber now has a lot to rethink and play catchup to Didi’s new wheels of “win-win”.
Harry Peterson, 10+ years experience in China Soucing, B2B Marketing
Répondu il y a 126w
1. From strategic competition dimension, Apple invested $1 billion in Didi is way to show that Apple has realized the dimensions of its growth problem, and want to learn from his competitors like Alphabet (Google), Facebook.
Apple’s rivals have long used their profits to invest in startups, buying some outright and investing in others. Alphabet has two investment arms, Google Capital and GV, formerly Google Ventures. In recent years, Google has bought Nest and invested in unicorns like Uber and Magic Leap. Microsoft has done the same, with investments in Facebook before it went public, along with the purchase of Minecraft’s parent company. And Facebook itself has been on a mobile growth spending spree under Mark Zuckerberg’s reign, buying Instagram, WhatsApp, and Oculus.
Apple’s investors have long wondered why Apple isn’t putting its cash pile to better use. Other than the $3 billion Beats deal in 2014–which was as much for the streaming music technology as anything–Apple has largely stayed out of the investments game even as their profits piled up. In 2012, Apple started handing out dividends again, after 17 barren years. In 2013, the company started buying back shares, at a cost of $87 billion. Both are tried and true ways to return cash to shareholders.
But neither dividends nor buybacks help Apple acquire growth (which is why shareholders have taken their cash to Facebook and Amazon). In the last quarter, iPhone sales declined for the first time, showing that Apple may no longer be a growth company at all. Still, even in such “terrible” earnings, Apple took in about $10.5 billion in net income in the quarter.
2. From capital dimension , this investment is a good way for Apple to spend that $200 billion offshore cash.
The top 50 US companies hold US$1.4 trillion in cash offshore – and a big chunk of that belongs to Apple. They’re all avoiding the 35 percent tax rate on repatriated cash – plus a few more percent to be paid in state tax.
Apple CEO Tim Cook said recently that he would “love to” repatriate Apple’s foreign profits – but he can’t because “it would cost me 40 percent.”
So Apple has about US$200 billion offshore that’s avoiding going towards paying for many things that San Francisco needs – like repairs for its aging subway system and some assistance for its homelessness crisis.
Throwing a billion bucks at Didi is a good way for Apple to make use of some of its Chinese profits sitting offshore while flipping the bird at the IRS.
3. Why Apple invest in Didi and not Uber?
The major reason is because Uber is based in San Francisco -- it’s an American company and so that $1 billion from Apple would have to come from Apple’s much smaller domestic cash stash. Also Didi’s valuation is less than half of Uber’s which means Apple gets more company for its money.
Think about it: which company is likely to ever grow 10X in value? Not Uber. 10X would be $625 billion -- worth more than Apple, Google or any other company anywhere. For Didi, 10X is $265 billion -- still a lot but more realistic, especially for a company that’s totally dominating the second largest world market for its services.
Another company that won’t grow 10X ever is Apple, itself. So if Cupertino wants capital gains, the better company to invest in is Didi, not Uber or Apple.
Now there are two more important points to make here. One has to do with cash and the other has to do with self-driving cars. Apple has the ability to finance any level of growth for Didi. If Didi wants to enter new markets, if Didi wants to assume financing obligations for new cars. If Did wants to -- and this is the big one -- buy Uber competitor Lyft, they can get Apple to finance it all from Apple’s stash of foreign cash. This is without regard to economic conditions in either China or the USA. If Apple wanted to buy Lyft directly they’d have to borrow or use USA cash. Helping Didi buy Lyft is a different story.
4. Apple wants to gather data related to its secretive plan to develop a self-driving car.
This is definitely the future and I think Apple is using this Didi investment to take a lateral run at the problem. Self-driving cars are going to be huge but the early market will also be problematic. Laws will have to be changed, people will die in accidents -- it is going to be a mess for awhile. But not a mess in China.
Here’s a country where people mainly don’t drive private cars yet and where the government is autocratic (pun intended). The Chinese government, if it sees an opportunity to assume a technical leadership role, will very quickly throw its weight behind self-driving cars. And just like third-world countries tend to have better mobile phone service than landlines, the newer technology will quickly dominate because it will be entering something close to a vacuum.
Think of China as a billion-passenger test market for self-driving technology. It will bolster the Chinese auto industry, help the domestic financial sector, decrease pollution, and even help the housing market. Private cars probably won’t be the norm in China, either. And every one of those Didi self-driving cars will include Apple technology.
Only when the Chinese market has stopped having growing pains and freak accidents will Didi’s self-driving technology come to the USA and Europe. And along the way Apple will be buying more and more of this likely success story. It’s Apple’s unique way to solve a financial problem and at the same time buy a leadership position in the second automotive age.
Nicholas Krapels, travaille à East China Normal University
Répondu il y a 126w · L'auteur dispose de réponses 138 et de vues de réponses 215.9k
As an expat living, teaching and consulting in Shanghai, I have often tried to use Uber. My friends use it. My wealthier Chinese colleagues use it. Tourists use it when they are in town. My international students use it during their semester abroad.
Uber’s appeal is obvious. It’s in English, while Didi is in Chinese. Uber uses nicer, personal cars that drivers have often just recently bought, sometimes even just to use as an Uber driver. Uber drivers are friendlier and some don’t even care if they get paid for the work. As one NPR report quoted a Shanghai Uber driver, "I hope to meet different people, make life more colorful and get to know a different Shanghai. I've now discovered, I'm addicted to this work." In China, Uber drivers are part-timers that often do the job more for the social connection than the pay. Uber driver Jasper Fu recently responded in an interview with QZ, “I don’t like driving but I like to talk to people.”
Didi uses taxi cabs. Taxi drivers spit and smoke cigarettes, drive recklessly, and often times are rude to their passengers. Cheating them on their fares by driving an indirect route or even by just jerry-rigging the fare box is not an uncommon occurrence. Yuck!
Uber only requires you to set a pickup location and then the nearest driver is automatically assigned the fare. Didi will not input your hail into the system until you have correctly identified both your pickup location (yes, this is a confirmation in addition to your raw GPS location data) AND a drop-off location. This one quirk means that the Didi platform is much more inefficient because nearby Didi drivers can cherry-pick the most valuable rides, while Uber just sends you the closest driver, period.
But still I cannot and do not use Uber. I always use Didi.
Why? The answer is simple.
Uber does not accept WeChat Wallet. Didi does. And for the longest time, Uber did not accept Alipay, despite the fact that it was listed as a payment option. I cannot tell you how many times I tried to verify my Alipay account only to have the Uber system reject the confirmation code that it sent to my cellphone.
When I inquired about this issue back in December 2015, I received the following reply:
International dual currency credit card? I cannot get one of those! The amount of paperwork and associated hassle required for an expat to get such a card is prohibitively bothersome. The other payment options, namely Paypal or one of my American credit cards, would require me to pay for my Chinese expenses with my American savings… which simply just makes no sense.
Doesn’t Uber know about China’s capital controls? Why should I have to export my Chinese earned income back to the States (and absorb all of the associated fees with the transfer) just to pay for a few taxi rides? No thanks, I’ll stick with Didi.
Entering the Chinese market without arranging for the acceptance of Alipay transfers demonstrates a lack of understanding of the Chinese market in general. As of the end of 2015, Alipay commanded an astounding 70% of China’s mobile payment market. How can you call yourself one of the most innovative and breakthrough companies in the world and enter the world’s largest automobile and cellphone market without a solid plan for incorporating the preferred payment method of 7 out of every 10 users? I mean, seriously, it’s not that hard. Baopals, an expat-focused Shanghai e-commerce startup, already accepts Alipay, WeChat Wallet, and UnionPay. They’ve been in business for a little over 3 months, have a staff of less than 10 people, and were started with just $77,000. And yet Uber’s Jiafeng Hu, in her adorably broken English informed me that even after two years in the Shanghai market, “due to the differences between banks and payment systems and diversity , so the situation can not be part of the new user bundled Alipay existence. There is no effective solution , please understand .”
Really? Tell that to Baopals. Tell that to Didi. Tell that to the millions of vendors all over China that accept both Alipay and Wechat Wallet. How in the hell did it take two-and-a-half years for Uber to accept Alipay in China? And they still don’t accept WeChat!
Uber can subsidize rides all it wants and garner legions of fans among the Chinese elite, but the real bounty of the Chinese market is its approximately 1 billion people who are lower middle class (as opposed to upper middle class) and below. And in that market, Didi is the clear winner, despite its technological inferiority.
It may not be as simple as the payment solutions it accepts, but Didi is much more in tune with its Chinese customer base. The market share statistics reflect this harmony. Didi’s statistics claim that it owns 99% of the taxi-hailing industry in China and over 87% of the private car service market in China (where it competes directly with Uber on its Yihao Zhuanche platform). Honestly, that’s not much of a competitive dynamic.
Moreover, subsidies do not guarantee long-term customers. Those same elites that saw Uber as a status symbol a year ago now have other options. Yidao Yongche is a China-based private car hailing service focusing on Chinese language drivers at home and in 20 cities abroad that, by all accounts, is just as good as Uber in the private car market and is even more heavily subsidized, which makes rides cheaper for the end user. In October 2015, the company raised $700 million at a $1 billion valuation. Remember that many