Chauffeur

Among a series of recent moves to diversify its business, Didi Kuaidi, the dominant transportation platform in China, has launched a on-demand personal designated driver service in ten Chinese cities, include Beijing, Shanghai, Hangzhou and Chongqing.

The feature helps car owners in urban areas find a qualified personal driver nearby to drive their own car home for whatever reason. Didi Chauffeur fares will include a charge for the first 10 kilometers that will vary throughout the day and depend on demand, as well as a fixed price for every additional kilometer traveled. The platform will take around 20% commission from the fare.

To provide protection for both drivers and passengers, every order for Didi’s designated drivers will be covered up to a maximum of 3 million RMB ($483,000 USD) under the chauffeur service liability insurance. The company claims to have registered more than 1 million drivers for the platform.

The Didi ‘Chauffeur’ service will be available in 15 more cities by August 2015, including Chengdu, Changchun, Xiamen, Fuzhou and Qingdao. It is expected that Didi Chauffeur service will be available in more than 100 Chinese cities by the end of this year.

Didi-chauffeur

Fu Qiang, former vice president of Kuaidi Dache, was named as the general manager of Didi-Kuaidi’s Chauffeur Department, marking the most important appointment following the merger.

Since Didi-Kuaidi’s coalition in February this year, rumors run that the Kuaidi management team is going to team-sell shares as they are taking a back seat in operating the combined company. A Wall Street Journal source indicates Kuaidi’s top managers will likely exit from senior roles in the company. The new adjustment may be designed to balance the power of the teams from the former companies.

Didi-Kuaidi usually faces a flock of existing competitors when expanding new businesses, including private car-hailing and car-pooling. However the chauffeur market is less crowded, perhaps due to the fact that existing players are very strong. eDaijia, a Beijing-based designated driver app launched in 2011, is among the one of the most prominent services in the field. It now provides service in more than 150 Chinese and overseas cities.

In the past, Kuaidi-Didi would squash smaller companies and snap up the market share by burning money. But it seems that wont work when competing with a equally loaded rival. eDaijia had secured $100 million USD in funding this May after receiving a $20 million USD round  from classifieds site 58.com in 2014.

China’s chauffeur market is expected to reach a transaction volume of RMB 2.69 billion ($433 million USD) by the end of 2015, the company cites industry analysis.

Image credit: eDaijia, ShutterStock