Briefing: Guazi acquires car sharing platform START

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瓜子二手车确认收购PP租车 更名为“瓜子租车” – Netease Tech

What happened: Chehaoduo, the parent company of Chinese used-car selling platform Guazi, recently closed on its acquisition of Beijing-based car rental company START, whose previous name translates into “PP Car Rental,” for an undisclosed sum. START’s online sharing platform will be rebranded as “Guazi Car Rental” and relaunched in 12 Chinese cities including Beijing, Shanghai, Guangzhou, Shenzhen, and Hangzhou.

Why its important: The deal marks Chehaoduo’s newest move: car sharing, which further diversifies its business units. The news follows on the heels of the company’s $1.5 billion financing round from Softbank Vision Fund on Thursday. START’s last fundraising event was in March 2016 when it raised around RMB 500 million (around $75 million). China’s rental economy sector has been cooling over the past year as financial troubles have hit some of the largest companies in the vertical. A Tianjin court froze RMB 1.45 million in assets belonging to bike-rental operator Ofo for payment default in late February. Figures (in Chinese) from The State Information Center show that investments in the mobility rental sector shrank to RMB 41.9 billion (around $6.2 billion) in 2018, a 61% decrease compared to the RMB 107.2 billion in 2017.