- Posted by Newsdesk
- On 12th April 2016
- china, mobile transportation platform, ride-hailing market, uber
Uber, the world’s leading online transportation network company – recently valued at over $62 billion – is losing over $1 billion a year in China. Gaining a foothold in the world’s largest ride-hailing market which is already served by a number of local competitors, however, will not be easy for the San Francisco-based tech giant. Nevertheless, at a conference in China, Uber CEO Travis Kalanick revealed that he believed that the company’s China operations will be profitable in just two years.
Uber currently operates in 400 cities worldwide and generates a profit of $1 billion from its top 30 cities globally. In spite of its popularity and success worldwide, Uber is only just getting started in the hugely competitive Chinese market. With 1.35 million drivers operating in 360 cities and 4 million daily calls for lifts, Didi Chuxing (formerly Didi Kuaidi) has already established itself as China’s largest rideshare service and has the backing of Tencent and Alibaba, the country’s two largest internet companies. Following its rebranding, Uber’s Chinese rival is looking to become the “world’s largest one-stop mobile transportation platform” and claim that its licensing by the Shanghai Municipal Transportation Commission makes it the “first legally authorised operator of an online private car booking platform in China”.
Regardless, Uber CEO Kalanick has expressed his optimism regarding the development of Uber China：“I’m not yet sure how much investment will take to get to profitability in China, but I’m optimistic that within the next couple of years we’re going to start seeing Chinese cities start to prop up and be profitable”
Indeed, Uber has recently extended its service into 18 new Chinese cities and plans to operate in 100 locations across the country. Whilst there is still a long way for Uber to go before it can replicate the domestic success of Didi Chuxing, it is actively making great strides in establishing itself as a serious player in the highly-competitive Chinese market.