Uber, the ride-hailing smartphone application, this month reported it is logging one million rides every day in China. The company is making aggressive efforts to win over consumers and compete with local rivals.

Uber, the San Francisco-based ride hailing firm, entered the Chinese market just two years ago. But its rapid expansion is quickly changing taxi service across the country.

And like many other markets, where Uber is upending traditional taxi and private car hire services, longtime drivers are complaining.

Beijing taxi driver Jin Zhu said the smartphone-based ride-hailing app is making it harder to earn a living.  

Jin said Uber’s use of private vehicles makes it difficult for taxi drivers like him to find customers. He said it’s not that they can’t find any customers - but that there are not as many as before. He said it’s getting harder for them to make money.  

Uber’s biggest local rival, Chinese firm Didi Kuadi, currently has more than 80 percent of the Chinese market and is backed by Chinese internet behemoths Alibaba and Tencent. Unlike Uber, Didi Kuadi also has services that use local taxis, instead of just private cars.

Uber is working to win market share through heavily discounted rides that are 35 percent less expensive than taxis as well as bonuses to drivers. The company says it also has created more than 60,000 jobs in China and earlier this month said it plans to spend $1 billion to expand in the country. 

“It seems like so far, with everything that they have done, they have been pretty aggressive about investing.  And they have a tie up now with Baidu which has gotten them a lot of extra funding.  The challenge in China that they don’t have in a lot of other markets in Europe or Asia, is that there are already a lot of competitors on the ground here,” said Ben Cavendar, an analyst with China Market Research.  

Uber CEO Travis Kalanick has been making regular trips to China to spearhead the Uber’s expansion further across the country.  In public speeches, he has been optimistic about the company’s chances, despite the difficulty many young western technology companies have faced in trying to win over Chinese consumers.

But Chinese competitors are also keen to take charge of the massive market for ride-hailing services. Last week, Uber rival Didi Kuadi said it was well on track to raise at least $1.5 billion in new funding, making the company one of China’s most valuable internet startup companies.

While the companies battle it out, consumers are enjoying the rivalry.  College student Jennifer Hong often uses the two ride hailing applications.  

She said she uses Didi Dache, didi Kuadi’s ride-hailing app, a lot more than Uber. Jennifer said she thinks it’s pretty convenient to get a cab in Beijing when the weather isn’t too bad.

Like in other markets, there have been protests against Uber in China. Some drivers oppose Uber’s slashed fares that make it harder for ordinary taxi drivers to compete. Chinese authorities have also raided some offices, accusing the company of operating without proper licenses.

But so far drivers’ protests are not stopping the ascent of these companies within China.  Uber plans to expand to fifty more Chinese cities within the next year.   [Read More]

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Source: VOA News: War and Conflict