Didi-Kuaidi, America’s Lyft Agree to Share a Ride

Didi Kuaidi announced a US$100 million investment in Lyft on September 16 and the two companies will work closely in technology and product development, according to the report.

The investment was part of the financing round that Lyft had early this year led by Rakuten.

The two companies allow the people of their respective countries to use their apps when they travel to China and the U.S.

China’s capital has launched a government-backed car-hailing app called Shouqiyueche at a time when taxi drivers nationwide have been complaining of increased market pressure from San Francisco-based Uber and Chinese market leader Didi Kuaidi.

Figures from the US worldwide Trade Administration data show that the number of people traveling between China and the United States reached 7.8 million past year , which represents an annual growth of over 10%.

Still, Uber’s presence in China is dwarfed by that of Didi Kuaidi, which controls 80 per cent of the overall ride-hailing market in China.

Cheng Wei continued, “Didi Kuaidi deeply admires Lyft’s commitment to best serve their driver and passenger communities”.

United States “sharing economy” taxi firm Lyft has teamed up with Chinese equivalent Didi in a “strategic partnership” created to see off the global threat posed by Uber. “We will continue to cherish and focus on our home base while sharing financial, technological and market resources to achieve a shared goal of building the most efficient, sustainable and diversified global transportation ecosystem”.

The same will be true for Didi’s users who travel to the U.S. , it said.

“For Lyft, this the best possible way for the USA population to enter into China and find a ride”, John Zimmer, co-founder and president of Lyft, said in an interview.

The partnership offers somewhat of a novel approach to worldwide expansion. The answer is simple – for a smaller Lyft, partnering with Didi Kuaidi means being able to expand heavily into China without having to dole out the kind of funds Uber can and is spending. These along with other connected services will extend to Lyft’s passengers.

While some critics think the numbers that Uber is claiming to have in China may be overblown, it’s clear that the company is making a big push.