Didi Chuxing Is Slowly Killing Off Uber China's Brand – Fortune


Everywhere on the planet, from nation to nation, Uber’s app seems and works the identical. Everywhere now besides China.

Three months after Uber’s China division was acquired by Didi Chuxing, the conqueror stated Uber’s new app, out subsequent month, wouldn’t embrace English, wouldn’t settle for overseas bank cards, and wouldn’t be usable outdoors of China. In different phrases, ridesharing is starting to look so much like China’s Internet: walled off from the remainder of the world.

For all of the ‘merger’ speak across the time of its cope with Uber China, Didi Chuxing did in reality purchase Uber China. As the acquirer, it has each proper to vary the model, and even subsume it into its personal. But on the time of the acquisition, it said Uber would hold “independent branding and business operations” for the “continuity of service for passengers.”

The new app model contradicts its earlier statements. But there are affordable explanations why.

The competitors between ridesharing corporations was among the many world’s fiercest in China, the place Uber was estimated to be losing $1 billion a year (and Didi even more) due to subsidies and reductions to realize drivers and customers. In this setting, each corporations had purpose to be proud of their Aug. 1 deal: Uber stopped the bloodletting in China, and Didi took over the deep-pocketed No. 2 participant in its market.


Uber China all the time operated as a separate entity from Uber’s international parent. Still, when Didi inherited the corporate, it needed to rework the authorized rights and mental property offers Uber China had with worldwide Uber. Foreign bank card funds inside China, as an example, have been arrange with Uber international’s cost companions.


Didi’s ambitions as we speak prolong outdoors China, and it needs to simply accept overseas bank cards. But these authorized rights must be restructured and redrafted. Two months hasn’t been sufficient time to deal with the “cross-border legal and intellectual property rights coordination,” in accordance with the corporate.

Today, Didi says the brand new Uber app launching in China shall be adopted by one other early subsequent yr, one with some options added again in. In the meantime, Didi is increasing Uber China into 400 cities by the top of this yr, up from 60 earlier than it was acquired.

Still, Uber China’s days look numbered. Earlier this month, the top of Uber China resigned. Users now complain about wait occasions three to 4 occasions longer due to fewer drivers utilizing the system. Drivers, in the meantime, complain about fewer customers. “It’s not the same as before,” one Beijing driver named Peng Fei stated yesterday. He’s making far much less cash than a number of months in the past due to fewer subsidies and riders. It appears the reverse of the community impact is eroding Uber’s relevance in China.

The similar factor occurred two years in the past when rivals Didi and Kuaidi Dache merged in China, and guarantees of preserving “independent entities” have been quickly damaged.

While one other Uber China app model might roll out subsequent yr, by then it won’t matter a lot.

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