After Didi received Apple's $1 billion investment, its rival Uber easily won three times this investment. In the Chinese market, Didi also has a comparative advantage, and the market speculates that “new money†will be used by Uber to discount the Chinese market. However, for the big drop, the global market is always its biggest weakness. The competition between the two is similar to Amazon and Alibaba.
Corresponding to the one-on-one arms race between platforms is the sword of supervision hanging over them. The new car policy did not come as scheduled in May, but the rumors and consultation drafts were not much different, especially since May. Security issues have made it possible for the New Deal to tighten, which makes it difficult for all major travel platforms to sleep. How to solve industry problems while encouraging travel sharing? What is the operation space that the New Deal will reserve for the network car? These unresolved questions may find the answer in June.
Car game
After Didi and Uber have merged into huge amounts of money, the level of competition has risen to the global market. If Didi wants to reach the market value of 100 billion yuan, it must be added to the premium of the international market. This story can be said to be complete. The competition between the two is very similar to Amazon and Alibaba. If other travel applications are still working with the two giants, the living space will become very narrow.
The hot money of capital is still being continuously transmitted to the travel platform.
On June 2, after Didi announced that it had received a $1 billion investment from Apple, Liu Yu, senior vice president of China Uber, also confirmed to the 21st Century Business Herald that the Saudi Arabian Sovereign Wealth Fund (PIF) will invest $3.5 billion in Uber. Become the largest single investment ever made to private companies. Uber's G-round financing has reached a total of $6 billion so far, and this investment will be used to support Uber's global business growth in China and other places.
Uber said in an e-mailed statement that PIF's investment has valued more than $66 billion, including cash received in the most recent round of funding.
In the Chinese market, Uber and Didi are in a competitive situation. Under the premise that both sides have strong capital, the new round of competition will continue to glue down, trying to win more markets from the other side.
However, the president of Didi, Liu Qing, said in a meaningful way that market leaders do not need to buy shares, only small, less effective companies are forced to do so. “China is a unique market, technology will be the key to success, subsidies are no longer the focus, no one is willing to board for 30 minutes for a 30% subsidy.â€
Discounted Chinese market
As a US company, Uber has entered more than 400 cities in 69 countries and regions around the world. Its expansion in recent years has been concentrated overseas, especially in the Asian market.
Uber injected $1 billion in its Chinese and Indian subsidiaries to try to capture market share from local competitors. This time the introduction of investors from Saudi Arabia is also aimed at expanding local market share, which is currently operating in nine countries and 15 cities in the Middle East, including Saudi Arabia.
It is reported that because women are not allowed to drive in Saudi Arabia, taxi service is particularly popular among Saudi women. PMA Managing Director Lu Mayan also said in a statement issued, "We have seen how the company has improved the mobility of the city around the world, and now we look forward to participating in this process."
The Uber Global Policy Advisory Board member, Saudi Princess Bandar, said that this is a symbolic investment, indicating which direction the country will go and investing in a visionary company. She added: "For Uber to enter our regional market, many people are still quite suspicious, and now PIF invests in Uber just shows that the situation has changed."
This is the largest investment UOB has raised, surpassing the previous round of $2.8 billion investment, which has set the largest amount of financing for US companies. In the future, this fund is very likely to be invested in emerging markets in Asia, as its China business is currently at a loss.
Uber CEO Travis Kalanick publicly revealed that Uber is profitable in the United States, while operating losses in China exceeded $1 billion. “Our top 30 cities in terms of global performance generate more than $1 billion in annual profits, and these profits contribute to our continued investment in Chinese projects.â€
In order to quickly occupy the market in a short time, Uber also had to join the subsidy war. In March 2015, Uber announced that the Uber price reduction of 30%, the driver's income and passengers' benefits are all borne by Uber. In November 2015, China Uber’s own data showed that they had entered the 21 cities with only 2% market share at the beginning of the year, and the overall market share exceeded 35%.
Oligarchic pattern
The reporter roughly sorted out the financing routes of Uber and Didi, and the financing capabilities of both parties are unmatched in the industry.
Since 2009, Uber has raised more than $10 billion in 16 rounds of financing, with 53 investors participating in the investment. Among them, there are many giants such as Google, Baidu and Toyota. Didi Travel has received $1 billion in Apple, $200 million from Alibaba, and $200 million from Ant Financial in nine rounds of financing. The current round of funds to be raised will be 3.5 billion US dollars, and the valuation will reach 26.5 billion US dollars.
The competition between the two sides has also expanded from previous subsidies to technology and services. In terms of the number of cities covered, Didi is leading the way, with more than 300 million users in 400 cities across the country. Uber covers 60 cities in China and is expected to reach 100 this year.
In addition, the travel financing of another travel platform has reached more than 790 million US dollars, but it is far from being able to compete with the two giants mentioned above. According to data released by LeTV official on April 20th, the daily order volume of the easy platform has exceeded 600,000, and the users exceeded 40 million.
In the interview with the 21st Century Business Herald, Di Wei, chairman and CEO of Didi Travel, revealed that the largest order is for the express service. The average daily order for private and express trains has exceeded 10 million orders.
It can be seen that Uber and Didi competition have entered a stage of white-hot, whether through localization or through cooperation and sharing of data, and the industry is beginning to show oligopoly.
In an interview with the 21st Century Business Herald, the CEO of Yiou.com, Huang Yuanpu, believes that after Didi and Uber have accumulated huge amounts of money, the level of competition has risen to the global market. "If the Didi is to reach the market value of 100 billion, it must be added to the premium of the international market. This story can be fully described. Only the Chinese market is far from enough. The competition between the two is very similar to that of Amazon and Alibaba."
In his view, if other travel applications are still working with the two giants, the living space will become very narrow. Unless it is like a Shenzhou special car, to revitalize the existing vehicle resources, the B2C road development commercial or high-end market can be competitive.
Two years later or IPO
Although at the scene of the Recode conference, the new round of financing will exceed Uber's $3.5 billion, Liu Qing said that the focus of Didi's future is not on user subsidies.
Liu Qing emphasized that the penetration rate of Internet travel users is only 1%, and there is still huge growth potential in the future market. Of the 400 cities in operation, 200 have achieved profitability. Compared with the past few years, the subsidy of Didi has been greatly reduced.
“Drip has almost 100% market share in taxi service and more than 80% market share in car service.†Liu Qing said frankly, when you are in the absolute leading position in the market, subsidizing users is not the most important. Things.
However, the reporter learned that the subsidies given to users by Didi have not stopped completely, but have adopted a method of differentiation and service improvement. For example, when a user orders an unanswered person, the drip will be subsidized accordingly, and in a remote area, the driver will be forced to pay a subsidy.
All kinds of behaviors are sending a signal to the outside world, and the Internet travel has long passed the era of subsidized enclosure expansion. Liu Wei also agrees with this. She once told the 21st Century Business Herald that in a healthy and normal market environment, drivers' income should be realized by increasing efficiency and doubling capacity, rather than through high subsidies.
After experiencing the brutal growth in recent years, Uber and Didi have to return to the essential business profits of the business. A few days ago, a financing material of Didi showed that the company plans to go public in 2018. Liu Wei also revealed that Uber China will strive to list in China, at least two years.
In this regard, Huang Yuanpu analysis believes that the two companies will continue to compete for orders in the Chinese market, and continue to improve internal profitability, and optimize financial statements without profit. Therefore, the competition in the travel industry will no longer be able to rely on subsidies to retain users, but to break through in terms of technology and management efficiency.
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