Didi Chuxing, which acquired Uber’s China division in August 2016, has dominated China’s ride-hailing sector for more than a year. The ride-hailing giant is now looking to develop new energy vehicle technology with its newly raised funding of USD 4 billion. The strategy is in line with those of China’s biggest tech players, Baidu, Alibaba and Tencent, companies that are all investing heavily in electric cars.
Didi Chuxing secured two rounds of financing in 2017. In April of last year, the company secured more than USD 5.5 billion financing, bringing Didi Chuxing’s total fundraising haul to more than USD 9.5 billion for the year.
After the latest round of financing, Didi Chuxing’s cash reserves are estimated at USD 12 billion. This large amount of cash may lead Didi Chuxing to enlarge its investments in artificial intelligence, to accelerate its global expansion, and to help develop its new business based on new energy vehicles.
A new energy vehicle service provider
In early November, Didi Chuxing’s founder and CEO, Cheng Wei, said his company had established a global new energy vehicle service company with Global Energy Interconnection Development and Cooperation Organization (GEIDCO). Didi and GEIDCO will promote the use of new energy cars and construct new energy vehicle-supporting services together.
On December 22, Didi Chuxing announced that its global new energy vehicle company will be located in Beijing’s Shunyi District. On the same day, it signed a contract with Shunyi Park of Zhongguancun Science Park to cooperatively build a testing center for self-driving cars, intelligent road networks, green transportation and other projects.
Starting in 2017, Didi Chuxing evolved from a ride-hailing app to an intelligent transportation platform. The building of a new energy vehicle service system is included in the company’s business plans.
The rollout of the new energy vehicle service system will necessitate many changes in road and transport networks. In the future, Didi Chuxing will enhance its refueling systems and charger networks. It has planned to build a nationwide charger network, called Xiaoju, which will provide new energy vehicle drivers with convenient and environmentally-friendly charging services.
Using big data
Cheng claimed that Didi Chuxing’s goal today includes integrating various types of taxis and expanding internationally. From his point of view, Didi Chuxing should aim to use big data to establish an industry standard for new types of shared vehicles rather than manufacturing cars.
The market for new energy vehicles is huge. The stock of new energy vehicles in China is the world’s largest, with cumulative sales of more than 951,000 units through December 2016. Due to the bright prospect of these cars, many internet companies have joined the the competition to produce them. However, Didi Chuxing decided to construct a new energy vehicle service system instead of building cars.
Apart from cooperating with other co-partners mentioned above, Didi Chuxing will take advantage of its own technological innovations. In 2015, Didi Chuxing established a machine learning institute and then upgraded it into the Didi Research Institute. The main functions of this institute are applying big data, artificial intelligence and cloud computing technology to transportation. Didi Chuxing has already started gathering information on transportation rules and road conditions in various Chinese cities.
Furthermore, Didi Chuxing claims that it has found an effective way to solve traffic jams in cities. It said that the use of its intelligent signal lights have led to a 10% to 20% decrease in delay times across several Chinese cities.
In the future, car transportation will integrate with information technology and new energy development. That’s why internet companies have poured money into new energy cars. Didi Chuxing has the advantages of having advanced data on national road conditions and advanced technology in new energy vehicles.
At present, Didi Chuxing has reportedly become the biggest new energy vehicle operation platform on earth. Didi operates 260,000 new energy vehicles as of December 2017, and the number could possibly exceed 1 million by 2020.
（Top photo from Pixabay）