The competition between Uber and Didi in China just got more interesting. Just after Uber announced that it was raising $3.5 billion, Didi Chuxing has announced that it is in the process of raising another round of funding which is larger than what Uber is raising.
Taking the stage at the Code Conference just after the Uber’s announcement (which was apparently purely “coincidental”), Didi Chuxing president Jean Liu made this announcement and said,
After this we’ll be one of the best capitalized private companies.
And that is something to say given the fact that Uber is currently the most heavily backed private company at a valuation of more than $60 billion. Liu further mentioned some numbers to make her point clear.
For instance, she said that Didi was present in 400 cities of China and was serving 14 million rides which is five times the entire US cab hailing market. Moreover, this is just a market penetration of 1% which still leaves an enormous room for growth.
When being asked about the funding round of Uber, Liu answered diplomatically and said,
On the Uber news — I have to say — our industry is actually very early stage, so the more capital that goes into it, the faster it grows, so it benefits every one of us.
However, she also admitted that fundraising could go on forever and they were ultimately focussed on winning the heart of the user to win the market.
Didi Chuxing also recently raised $1 billion from tech giant Apple which has put its total funding at $5 billion till now. In addition to funding, Didi has also been a frontrunner in striking strategic alliances with Uber global competitors such as Lyft in the USA, Ola in India, and GrabTaxi in South-east Asia.
All these companies have set up a global alliance to take on massively funded Uber in their respective locations as well as globally.
On the other hand, Uber — armed with massive funds — has claimed to overtake Didi in terms of overall market share in China within next 12 months.
It remains to be seen which company out of Uber and Didi will manage to grab the taxi market in the world’s most populous country.