Chinese ride-hailing giant Didi will impose higher fares over the Spring Festival, as passengers will be required to tip drivers amid a nationwide driver shortage exacerbated by the national holiday.
In an open letter to its passengers, Didi has asked users to pay a “special Chinese New Year fee” to drivers when they book their trips between Jan. 28 and Feb. 10. The holiday tips range from RMB 1 ($0.15) to RMB 9, varying depending on location and date, and will be given in full to the platform’s drivers.
Didi is already short of drivers in major cities amid increasingly stringent regulations. However, it anticipates a further shortage driven by the Chinese New Year, when most drivers will take a holiday break amid increased demand.
The tip system will be applied to its major ride-hailing services—Express, Premier, and Didi-owned Uber China—in nearly 268 cities across the country.
Users in Beijing will pay the highest premiums, which will reach up to RMB 9 per trip from Feb.4 to Feb. 6. Shenzhen and Shanghai follow with highs of RMB 8 and RMB 5 respectively. Didi expects that the longest queues will occur between Chinese New Year’s Eve and first two days of China’s first lunar month (Feb. 4 to Feb. 6). The company said drivers will also be given additional subsidies, from RMB 2.8 to RMB 100 per trip, as a reward for working during the Spring Festival.
“We expect the request response rate [from drivers] to drop by 20% across mainland China as the nation goes into festival mode,” the company said in the letter. It added that users will be able to check average response rates from the previous day and peak hours for specific areas from Jan. 28.
In spite of the mounting pressure from authorities and the public following the murder of two female passengers by its drivers last year, the Chinese ride-hailing remains a dominant figure in China’s mobility sector.
Still, Alibaba-backed Hello Transtech is taking on them, planning to provide carpooling services in 10 cities by the end of January.