logo
logo

Uber’s Efforts to Build Chinese Business Ultimately Fail Against Homegrown Rival Didi

avatar
Jose Breland

BEIJING—Uber Technologies Co. tried harder than perhaps any other American internet firm to build a truly Chinese company that could win in China.

After almost three years, Uber agreed to sell its China business to its rival, Didi Chuxing Technology Co., the Chinese company announced Monday.

It was likely no coincidence that Uber Chief Executive Travis Kalanick s decision came on the heels of China s new ride-hailing regulations, which were announced last week but had been in the works for two years and were known to companies in the industry in advance.

That was Didi, which is backed by Apple as well as Chinese internet giants Alibaba Group Holding Ltd. BABA 2.51 % and Tencent Holdings Ltd. TCEHY -1.12 %

The rules forbid companies to operate ride-hailing services below cost, putting an end to ruinous subsidy wars but making it difficult for UberChina, with its smaller scale, to match Didi on price.

The guidelines also require companies to implement stricter driver oversight and incur other overhead expenses, measures likely to be less costly per ride the larger the user base.

collect
0
avatar
Jose Breland
guide
Zupyak is the world’s largest content marketing community, with over 300 000 members and 3 million articles. Explore and get your content discovered.