Didi Chuxing aims to internetize China’s taxi industry with USD 15 M investment

Ride-hailing platform Didi Chuxing announced on Wednesday that it would partner with nearly 50 taxi companies across 10 Chinese cities to help improve their efficiency and services. In addition, Didi will establish a fund of RMB 100 million (USD 15 million) to accelerate the integration of rideshare and taxi industries.

“Didi’s success today would not be possible without the support from our early taxi partners and millions of taxi drivers at the beginning,” said Cheng Wei, founder and CEO of Didi. “We work to inject the power of the internet to the traditional taxi industry for better growth.”

Photo taken by Ke Jin at the signing ceremony
Photo taken at the signing ceremony

By utilizing Didi’s big data capabilities, Didi and its taxi partners will introduce a coordinated intelligent request-dispatching (IRD) system, which assigns ride requests to the most suitable vehicle by taking various variables into account, including distance, demand and supply, drivers’ ratings, etc.

The IRD system is designed to bring three major benefits:

First, it aims to lowers vacancy rates. For example, data analysis will detect a driver who regularly sends kids to school on weekdays at seven or eight, and the system may dispatch orders to the driver the evening before so that s/he could directly pick up a passenger right after sending the kids off. Didi’s strength will help stitch the rides together and maximize the time of each taxi being occupied by passengers.

Second, Didi claims that it will increase taxi drivers’ income. According to the agreement, the request dispatching control base of Didi and the rider-driver matching systems of the taxi companies will be integrated. In that light, taxi drivers working with the partner companies will be able to pick up private-car rides upon the consent of the riders.

Third, it is designed to improve service quality. The internetized taxi industry will have taxi drivers work to improve their ratings so as to be dispatched with more orders. According to Didi, company beta tests have shown that, when switching to the new IRD system, a driver’s hourly income rises as much as 50%, and the vacancy rate drops as much as 36%.

By introducing mobile internet technology to the traditional taxi industry, Didi, which averaged 16 million rides completed per day in Q2 2016, is shifting its focus to help internetize China’s taxi market.

(Top photo from Baidu Images)

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Ke Jin

Ke graduated from the University of Edinburgh with a Master's Degree in English and has worked on projects with Ipsos MORI and SDI Media. She's particularly intrigued by China's thriving technology scene and is eager to write about this flourishing industry.

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