So Uber’s dedicated Chinese branch, Uber China is through raising funds — at least for now — and the company has set its eyes upon bringing the cash to bear and using it to expand in the country. The company about to undergo its largest single expansion drive that will see it established in 37 cities, from the incumbent 22.
The schedule is pretty tight though and is expected to complete before February the eighth — Which incidentally, is also the Chinese New Year. All the cities earmarked for this expansion are from Sichuan, China’s fourth most populous province, also marking a departure from tradition for Uber.
While the company had been focusing upon large, population intensive cities until now, this wilingness to move to relatively smaller cities may be an indication of the fact that Uber is finally ready to dig deeper. The company has had a good run of luck in the province so far with Provincial capital Chengdu becoming Uber’s top city worldwide — based on weekly completed trips — a mere 9 months after launch.
As per Zhen Liu, Head of Strategy, Uber China,
We have built a strong foundation across the country and have put in place an excellent local team that will drive our growth in the year ahead… our goal is to be in 100 cities across China by the end of the year,
Talk about ambitious goals. The timing is also right as the Chinese New Year just happns to be the largest annual migration on the planet as working folks from the Urban areas return home for the holidays.
The company has quite a bit of catching up to do in the country though. Didi Kuaidi, the largest travel aggregator in the country is well established in over 360 cities and reportedly, has reached the break even point in a 100 of these. Valuation wise as well, it carries a price tag that is more than double of Uber’s $8 Billion one.
However, Uber is a relatively new entrant in China and is hard upon Didi’s heels. What’s more, the company is flush with funds and is not shy of deploying them to gain a purchase with innovative ideas. For example, the company said that it is opening up ride-stations at “well-known” landmarks across the city with an eye towards the creation of designated areas where drivers can meet passengers, useful when the passenger is unfamiliar with the area.
Well, the year of growth — 2015 — was certainly pretty eventful for Uber China. Let us see how the “Year of Expansion” turns out to be for its the American aggeregator’s Chinese operations.