Taxi apps Kuaidi and Didi Dache have entirely transformed the local taxi market, pushing each other to new innovation heights. Will Didi Dache’s latest attempt to win the battle backfire?
The “Special Taxi” option is the latest of Didi’s inventions and collaborations, playing to the tastes of the rich and glamorous, known in China colloquially as Tuhao 土豪 (online dictionary iciba offers up the translations Beverly Hillbillies or rich rednecks as an approximation). For these people, to whom face is everything, and face can be won through excessive displays of wealth, taking a lowly taxi to show up to a high profile event is a no-go.
Enter Didi’s Special Taxi option; the new feature allows users to book a “luxury taxi’, such as BMW’s or Mercedes, the minimum worth in order to qualify the vehicle for the service is ¥ 180 000. The cars feature a bottle of mineral water in each back door of the car, wet wipes, hand cream and a phone charging device. The luxury taxi comes of course at a cost, and that is approximately three times that of a regular ride. According to a JSTV reporter, who decided to investigate the app’s latest shenanigans, an 8km ride including slow driving fee, charged if the driving speed falls below 12 km/h to take traffic jams into account, in addition to the minimum price of ¥17 per ride added up to ¥ 63.6.
This price is displayed via the app, not a traditional taxi meter; and herein lies the problem. The cars are not registered taxis, without meters but more importantly without any information about the driver of the car, calling into question the safety of the model. According to the JSTV report, drivers are people with regular jobs, who are in the position that they do not need to be at their desk constantly and are free to wander off and drive the rich and carless around the city (our best guess being they are low-level officials). Although according to the service center, insurance needs to be taken out by the drivers to cover for any accidents , it is unclear whether insurance companies will be willing to cover for someone who is moonlighting as a driver. It is certainly a big risk to take, delivering proof of how heated the competition is in the taxi app market. There must be a lot of stake for Didi.
Long Standing Rivalry
The stakes are indeed high. Didi’s main competitor Kuaidi seems to be coming out on top on paper. While Didi’s grip remains tight on Beijing as well as Nanjing, despite reports proclaiming the Yangtze River Delta to be Kuaidi turf (it seems Nanjinger’s like to be different), the latter has taken the lead in the Northeastern, Northwestern and Southern parts of the country. Both companies are looking to cooperations with other industries and creating an efficient O2O (online to offline) model to steal the competition.
Mid-October, both Didi and Kuaidi announced they were teaming up with online real estate companies Leju and focus.cn respectively to offer taxi services at reduced prices to customers traveling to house viewings booked upon browsing the websites.
This is a venture which takes the companies even further afield than previous cooperations; they have already started working with telecommunication providers, Didi Dache signing up China Telecom to offer special phone tariffs that include deals for the taxi app, while Kuaidi chose China Unicom as their partner in crime.
Currently, Didi’s strongest advantage over Kuaidi is having managed to sign up Tencent’s Über-App WeChat, the social media/communication/information/banking tool, without which the entire country would probably break down, as a virtual payment partner.
While it seems, for now the two rivals are locked in a dead heat, it remains to be seen whether the Tuhao Taxi will turn out to be a blessing or a curse in Didi’s quest for nationwide taxi dominance.
