Chinese car rental and ride-booking service Yongche confirmed that it has secured Series C financing led by Government of Singapore Investment Corp (GIC), a Singapore gov-backed investment institution which is also the investor of Alibaba and JD. The company did not announce details of the deal, but local media reports that the financing amount exceeds US$100 million with participation of Baidu.
If the financing amount was true, Yongche’s total funding would reach nearly US$190 million together with US$10 million of Series A received from Morningside Ventures and Qualcomm Ventures in 2011, US$20 million of A+ round from existing investors and CBC Capital and US$60 million of Series B let by Ctrip and DCM in Dec 2013.
As one of the first Uber-style car rental services in China, Yongche is planning to release a commercial vehicle rental service with Baidu. The service will be integrated into Baidu Map as the only car-booking service focused on business trips on the platform. It is also going to support payment via Baidu Wallet in the future.
The competition in commercial vehicle rental market is heating up in China. After the official launch in Shanghai and Beijing, Uber continues its aggressive expansions to the cities of Guangzhou, Shenzhen, which are now in trial periods. New target cities of the U.S. company include Hangzhou and Chengdu, according to an exec of Uber China. Didi Dache also has plans for this sector and has launched a chauffeur training program in Beijing. PPzuche secured US$10 million of Series A financing led by Sequoia Capital China in June. AAyongche netted US$10 million of funding recently. (source in Chinese)
With different players in commercial car rental industry receiving massive financing rounds, what happened so far sounds quite similar to the conditions of taxi-hailing market around the beginning this year when Didi Dache and Kuaidi Dache pocketed huge financing from deep-pocketed bakers of Alibaba and Tencent respectively, and then a multi-million cash burning battle soon ensued.
It is worth nothing that car rental services like Yongche, PPzuche and AAyongche are constantly being questioned with illegal operation problems. Beijing municipality has prohibited car rental companies from using private vehicle or other non-lease vehicles for operation, moreover, car rental companies are not allowed to provide driving labors.
image credit: Yongche