After receiving a massive $2 billion USD funding last week, China’s largest taxi-hailing app Didi-Kuaidi is adding a new alternative to its transportation platform: Didi Bus, a shuttle bus service for commuters. It comes at a time when similar services are being stamped out by wary authorities.
The service will start with 33 routes in Beijing and 10 routes in Shenzhen and will cover several hundreds journeys in the two cities by end of July, according to the company.
Didi Bus will initially be operated through WeChat, a popular IM tool developed by Didi Kuaidi’s investor Tencent. After following the official account of ‘Didi Bus’ on WeChat, users can register with their phone number and choose their commuting routes and time. Riders will receive an e-ticket which is charged on a pay-as-you go basis at a price of around 7-13 RMB ($1.12 to $2.09 USD) per ride, which is 3-5 times the price of public buses. The company has said it will will provide a freebie price of 0.01 RMB per ride for the first week of operation however.
The internet firm has teamed up with licensed travel agencies and leasing companies to source the bus fleets. The shuttle routes were crowd-formed by requests from travelers, as well as existing route information.
The service is aimed at urban commuters aged between 20 to 40 years, and is designed to compliment China’s poor public transportation system, Didi Bus is also tapping into ideas on sustainability to help plug their new service, pointing to the poor carpooling record of China’s cities. Didi Bus is the latest step by the Tencent-Ali coalition to expand and monetize the immensely popular hailing app. The merged entity has gradually rolled out carpooling, black car services and designated driver services over the past 6 months.
In addition to tickets, potential revenue sources for this service include bus advertisements, sales of goods and value-added services for riders, including designated seats. The service appears to be similar to Leap Transit, a San Francisco-based luxury bus service for commuters that is commercializing through higher-end services including WiFi connections, refreshments and leather seats.
However, whether the shuttle bus service will make headway in the Chinese market is still to be seen. Leap Transit has suspended operations after receiving a cease-and-desist order from local regulator due to a lack of proper permits, which means the Didi Bus is also facing regulatory risks in China.
Liu Qing, president of Kuaidi, is still quite optimistic about the prospect of Didi Bus in China however. She argued that transport reform will come about in the same way that other changes have in China, saying that “before every new reform there are always contradictory voices, but history repeats, just as private dining replaced state-run cafeterias [in China].”
Image Credit: Didi Kuaidi