Chinese ride-hailing giant Didi Chuxing’s (滴滴出行) overseas business has turned a corner after dropping to a low in the middle of last month amid the COVID-19 pandemic and is already looking into new markets and payment firm acquisitions, a senior executive said.
Although bullish about future prospects, Tony Qiu (仇廣宇), chief operating officer of Didi’s international operations, conceded that the business expects a “double-digit” percentage hit in the short term, echoing gloom across an industry squeezed by travel restrictions in many countries to contain the novel coronavirus.
“Business has recovered a little since reaching a low in mid-March,” Qiu said in an interview. “In the short term it will impact our business by double-digit, but we hope by doing what we do during the epidemic, we will overcome the virus,” he said.
Photo: Reuters
Last week, Uber Technologies Inc warned of an up to US$102 million revenue hit in the first half of this year, while Singapore-based Grab Holdings Inc said that its ride volumes have fallen by a double-digit percentage in some countries.
Uber withdrew its forecast for this year for gross bookings and earnings, while Grab said that it would cap costs.
BOOMING BUSINESS
Uber owned at least 15 percent of Didi as of September 2018 after selling its Chinese operations to its one-time rival in 2016.
Now easily the biggest ride-hailing firm in China, Didi has also been backed by Japan’s Softbank Group Corp to the tune of nearly US$12 billion and was valued at US$56 billion in a 2017 financing round.
Qiu declined to be more specific on the financial details of the pandemic’s effects on operations.
He said that his business unit saw daily rides hit a peak of 5 million before the epidemic.
On average, daily overseas rides account for about 20 percent of Didi’s entire ride-hailing operation.
Underlining the company’s bullish approach, Didi CEO Cheng Wei (程維) last week said that the firm aims to have 800 million monthly active users globally and complete 100 million orders per day by 2022, including ride-sharing, bike and food delivery orders.
Demand for Didi in China has been recovering quickly since the easing of city lockdowns due to the pandemic, the company said.
One of the firm’s main products, Anycar, through which passengers can hire ride-hailing cars or taxis, last month saw orders more than triple from February.
OVERSEAS EXPANSION
Qiu declined to say how much his business unit might invest in new acquisitions.
“Acquiring and working with payment companies which have the banking license, payment or financial technologies would bring advantages to Didi’s global business,” Qiu said, adding that there are no clear plans yet for any deals.
Beyond China, Didi operates in eight countries in Latin America, Australia and Japan.
New markets being studied could be in Europe, the Middle East and Africa, Qiu said, but added that Didi has no clear plan to enter Southeast Asia and the US for now, as those markets have already become fierce battlegrounds for the likes of Uber, Lyft Inc, Grab and Indonesia’s Gojek.
Other expansions being considered would be food delivery services and payment operations in markets where it is already present. Didi already delivers food in Japan, Brazil and Mexico, and is rolling out on-demand delivery and courier services in Australia and Latin America.
Didi is also exporting practices developed in China to cope with the pandemic, Qiu said.
For example, in Mexico it is offering instructions to drivers on how to install protective plastic sheets in their vehicles, while it is helping to disinfect vehicles in Brazil, he said.
It is also looking into how it can better use technology to trace infected people, Qiu said.
Online booking allows easier contact tracing than conventional taxis, and technologies used by Didi’s platform helped Chinese health authorities quickly track down infected cases, as well as those who had close contact with them, he said.
The domestic unit of the Chinese-owned, Dutch-headquartered chipmaker Nexperia BV will soon be able to produce semiconductors locally within China, according to two company sources. Nexperia is at the center of a global tug-of-war over critical semiconductor technology, with a Dutch court in February ordering a probe into alleged mismanagement at the company. The geopolitical tussle has disrupted supply chains, with some carmakers reportedly forced to cut production due to chip shortages. Local production would allow Nexperia’s domestic arm, Nexperia Semiconductors (China) Ltd (安世半導體中國), to bypass restrictions in place since October on the supply of silicon wafers — etched with tiny components to
Singapore-based ride-hailing and delivery giant Grab Holdings Ltd has applied for regulatory approval to acquire the Taiwan operations of Germany-based Delivery Hero SE's Foodpanda in a deal valued at about US$600 million. Grab submitted the filing to the Fair Trade Commission on Friday last week, with the transaction subject to regulatory review and approval, the company said in a statement yesterday. Its independent governance structure would help foster a healthy and competitive market in Taiwan if the deal is approved, Grab said. Grab, which is listed on the NASDAQ, said in the filing that US-based Uber Technologies Inc holds about 13 percent of
Taiwan is open to joining a global liquefied natural gas (LNG) program if one is created, but on the condition that countries provide delivery even in a scenario where there is a conflict with China, an energy department official said yesterday. While Taiwan’s priority is to have enough LNG at home, the nation is open to exploring potential strategic reserves in other countries such as Japan or South Korea, Energy Administration Deputy Director-General Chen Chung-hsien (陳崇憲) said. While the LNG market does not have a global reserve for emergencies like that of oil, the concept has been raised a few times —
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday received government approval to deploy its advanced 3-nanometer (3nm) process at its second fab currently under construction in Japan, the Ministry of Economic Affairs said in a news release. The ministry green-lit the plan for the facility in Kumamoto, which is scheduled to start installing equipment and come online in 2028 with a monthly production capacity of 15,000 12-inch wafers, the ministry said. The Department of Investment Review in June 2024 authorized a US$5.26 billion investment for the facility, slated to manufacture 6- to 12nm chips, significantly less advanced than 3nm process. At a meeting with
RSS